Despite losing 205,000 net customers, T-Mobile USA still managed to scratch out a profit of $207 million during the second quarter of 2012.
Profits are down by $5 million, not a huge drop from this time last year but still worrisome for the company, especially in light of the customer exodus.
Between a rock and a hard place
T-Mobile found itself in an awkward middle position as it can't quite compete with high-end carriers like Verizon and AT&T yet can't keep up with attractive offers coming from the industry's prepaid sector.
It lost 557,000 net contract customers, the Holy Grail of consumers as they sign long-term contracts and pay the priciest monthly bills.
While Verizon, AT&T and Spring were all able to increase revenue from monthly fees, T-Mobile saw that number slip by 9 percent.
On the bright side, the company did add 227,000 prepaid customers. This figure is more than triple the number from this time last year and was thanks to customers switching from T-Mobile's no-contract Monthly 4G program.
However, T-Mobile failed to make any ground in the smartphone sector, staying stagnate at 11.6 million. Other companies rely on smartphone sign-ups to drive up monthly fees.
Though it's trying to break into the wholesale, the German-owned company saw a staggering drop in that area from one year ago.
Ship needs to be righted
While not quite ailing, T-Mobile's customer losses may foreshadow bigger issues to come as the company is currently without a permanent captain.
CEO Philipp Humm resigned in June and while interim CEO Jim Alling has taken the reigns, T-Mobile needs some stability at the top.
T-Mobile is publically placing the blame for its loses on tighter credit standards, the phase-out of older devices and a generally weaker environment for potential new customers.
Via CNET and Washington Post
