Third-quarter earnings at Telephone & Data Systems Inc.
(TDS) and its U.S. Cellular Corp. (USM) business rose, with U.S.
Cellular losing more subscribers than a year earlier.
Both companies topped analysts' expectations and adjusted their
revenue outlooks for the full year. U.S. Cellular narrowed its
target while TDS raised its to $785 million to $800 million from
$760 million to $790 million as the company also expects higher
profit than before.
U.S. Cellular has been losing postpaid subscribers of late amid
increasing competition in the wireless industry as the market is
nearly saturated with cellphones. Big carriers have continued to
add subscribers on the strength of marquee handsets.
TDS reported a profit of $40.6 million, or 38 cents a share, up
from $36.8 million, or 34 cents a share, a year earlier. Revenue
rose 0.7% to $1.27 billion.
Analysts polled by Thomson Reuters had most recently forecast
earnings of 34 cents on $1.26 billion in revenue.
The company's physical access lines decreased 4.2% from a year
earlier and 1.5% from the prior quarter.
Meanwhile, U.S. Cellular posted a profit of $37.4 million, or 43
cents a share, up from $34.3 million, or 39 cents a share, a year
earlier. Revenue edged up 0.3% to $1.06 billion.
Analysts most recently forecast earnings of 41 cents on $1.05
billion in revenue.
The carrier, which operates in 26 states, lost 25,000 net retail
subscribers, compared with 6,000 a year ago. On a post-paid
basis--users with long-term contracts--the company lost 25,000
subscribers compared with year-earlier additions of 8,000.
Retail average revenue per user rose 0.3% and retail postpaid
churn fell to 1.6% from 1.7%.
Shares of TDS and U.S. Cellular closed at $35.93 and $47.44,
respectively, Wednesday and were inactive premarket.
-By Nathan Becker, Dow Jones Newswires; 212-416-2855;
nathan.becker@dowjones.com