MetroPCS Communications Inc. Earnings Cheat Sheet: Profit Dips and Misses Estimates

S&P 500 (NYSE:SPY) component MetroPCS Communications Inc. (NYSE:PCS) reported its results for the third quarter. MetroPCS Communications is a wireless communications carrier that offers broadband mobile services in the United States.

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MetroPCS Communications Earnings Cheat Sheet for the Third Quarter

Results: Net income for MetroPCS Communications Inc. fell to $64 million (19 cents per share) vs. $77.3 million (22 cents per share) a year earlier. This is a decline of 17.2% from the year earlier quarter.

Revenue: Rose 18.1% to $1.21 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: PCS fell short of the mean analyst estimate of 23 cents per share. Analysts were expecting revenue of $1.22 billion.

Quoting Management: Roger D. Linquist, Chairman and Chief Executive Officer of MetroPCS, said, “We reported solid results during a seasonally slow period and during challenging economic times. Subscriber growth of 69 thousand was driven primarily by our strong sales of Android Smartphones. Throughout the remainder of 2011 and in 2012 we plan to further enhance our Android Smartphone offerings which allow access to compelling applications and products including our recently introduced Rhapsody music service.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 17.8%, with the biggest boost coming in the first quarter when revenue rose 23.1% from the year earlier quarter.

The company has now fallen short of analyst estimates for the last three quarters. It missed the mark by 4 cents in the second quarter and by 3 cents in the first quarter.

Last quarter’s profit decrease breaks a streak of two consecutive quarters of year-over-year profit increases. Net income rose 5.5% in the second quarter and more than twofold in the first quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the fourth quarter has moved down from 26 cents a share to 20 cents over the last ninety days. At 83 cents per share, the average estimate for the fiscal year has fallen from $1.01 ninety days ago.

Competitors to Watch: Leap Wireless Intl., Inc. (NASDAQ:LEAP), Verizon Communications Inc. (NYSE:VZ), Sprint Nextel Corporation (NYSE:S), NTELOS Holdings Corp. (NASDAQ:NTLS), Telephone & Data Systems, Inc. (NYSE:TDS), United States Cellular Corp. (NYSE:USM), AT&T Inc. (NYSE:T), Shenandoah Telecommunications Co. (NASDAQ:SHEN), Clearwire Corporation (NASDAQ:CLWR), and Deutsche Telekom AG (DTEGY).

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(Source: Xignite Financials)