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T-Mobile Reports Staggeringly Good Numbers, Gets Takeover Bid

By Craig Galbraith
July 31, 2014 - News

The last time many of T-Mobile’s customers heard the term “Iliad," they were in high school or college trudging through Homer’s epic poem — but that could soon change.

Iliad, a 15-year-old telecommunications provider based in France, reportedly has offered to buy T-Mobile USA for $16 billion. This follows months of talks between execs at Sprint and T-Mobile about a merger between America’s third- and fourth-largest wireless operators.

The Wall Street Journal reported that Iliad made the bid to T-Mobile’s board just days ago, citing people familiar with the matter, who claim it to be a one-of-a-kind opportunity for the French company to enter the U.S. market.

While Iliad’s supposed bid is much lower than the reported $30 billion offer Sprint has made for the Magenta Network, we don’t know many details about it just yet. A Sprint-T-Mobile tie-up is sure to be closely scrutinized by regulators, many who fear the loss of one of the “big four" in the U.S. telecom market.

All that being said, one might wonder if being acquired would really benefit T-Mobile any longer. The company announced on Thursday that it added 1.5 million customers in the second quarter – matching Verizon’s increase last quarter. This is T-Mobile’s fifth consecutive quarter with at least 1 million additions, momentum it started building last year when the company unveiled its “uncarrier" initiative, doing away with postpaid contracts for new customers. It’s a model that has proved to be very successful.

Other T-Mobile numbers from the second quarter were equally impressive. The Bellevue, Washington-based company swung to a profit of $391 million and increased revenue to $7.2 billion. That’s a 4.5 percent increase over the previous quarter and an 8 percent spike compared to the same quarter a year ago.

Tablet sales last quarter were fives times that of the first quarter. T-Mobile sold 6.2 million phones, 93 percent of which were smartphones.

T-Mobile now serves more than 50 million customers. Meantime, Sprint is headed in the opposite direction after Wednesday reporting a loss of 344,000 subscribers. 

Follow senior online managing editor @Craig_Galbraith on Twitter.

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