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U.S. Cellular +10% after beat, new boost to profit guidance

Nov. 02, 2018 11:07 AM ETUnited States Cellular Corporation (USM) StockBy: Jason Aycock, SA News Editor
  • United States Cellular (NYSE:USM) is up 9.8% after a healthy beat in its Q3 profits and another boost to profit guidance for the full year.
  • Revenues rose to $1B from $963M. Net income was $36M vs. a year-ago loss of $299M (affected by a $370M noncash charge for goodwill impairment).
  • Postpaid subscribers fell again, by just over 1,000 to 4.466M; feature phones fell by a net 14,000, and connect3d devices declined 16,000, but smartphones rose by 29,000.
  • ARPU ticked up to $45.31 from last quarter's $44.74 and last year's $43.41. Churn of 1.29% was higher than last quarter's 1.19% and last year's 1.16%.
  • Prepaid saw net adds of 1,000 to bring that subscriber total to 528,000. ARPU fell again, to $32.09 from last quarter's $32.32 and last year's $33.12. Churn rose here as well: to 4.98%, from last quarter's 4.83% and last year's 4.75%.
  • Revenue breakout: Service, $759M (up 3%); Equipment sales, $242M (up 7%).
  • The company narrowed expectations for full-year revenue again (to $3.95B-$4B, from a previous $3.925B-$4.025B) and boosted OIBDA guidance to $760M-$810M (from $700M-$800M) and EBITDA guidance to $925M-$1B (from $850M-$950M). It also now sees capex of $500M, vs. previous guidance for $500M-$550M.
  • Previously: United States Cellular beats by $0.15, beats on revenue (Nov. 02 2018)
  • Earnings call slides
  • Press release

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