Tuesday, November 1, 2011

Clearwire Adds 1.9 Million 4G Users in Q3

Clearwire reported continued demand for its 4G services as it reported record adds and revenue. Clearwire added 1.89 million total net new subscribers in Q3, comprised of 35 thousand retail and 1.86 million wholesale net new subscribers. The company ended third quarter 2011 with approximately 9.54 million total subscribers, up 240% from 2.81 million subscribers in third quarter 2010. The subscriber base consists of 1.32 million retail subscribers and 8.22 million wholesale subscribers.

Clearwire now expects to end 2011 with over 10 million users, exceeding previous guidance.

Clearwire's wholesale subscribers consist primarily of Sprint 3G/4G smartphone customers.

Third quarter 2011 aggregate network usage by wholesale customers increased 34% compared to second quarter 2011, driven primarily by growth in aggregate smartphone usage, which increased 43% over the same period.

Third quarter 2011 revenue was $332.2 million, a 134% increase over third quarter 2010 revenue of $142.2 million. Third quarter 2011 retail revenue and other revenue was $195.0 million, a year over year increase of 55% from $125.6 million in third quarter 2010. Third quarter 2011 retail average revenue per user (ARPU) was $47.05 up from $43.10 in third quarter 2010. Wholesale revenue in third quarter 2011 was $137.2 million, a year over year increase of 730% from $16.5 million in third quarter 2010. Third quarter 2011 wholesale ARPU was $6.20, up from $4.46 in third quarter 2010.

"Today Clearwire is the only operational 4G wholesale business combining an all-IP network, substantial spectrum resources, and a technology roadmap to serve the growing demand for mobile broadband. We believe Clearwire's deep spectrum resources are capable of meeting the urban demand that will likely strain the lower-capacity LTE deployments planned by other wireless operators. Our common global technology roadmap, aligned with members of the Global TDD-LTE Initiative (GTI), including China Mobile, the largest wireless carrier in the world, should position us to benefit from the significant economies of scale of a converged LTE ecosystem. We look forward to opportunities to work with our current wholesale partners, and other wireless carriers, to serve this growing market," stated Erik Prusch, President and CEO of Clearwire.

Some notes from the conference call:

  • The Clearwire network now has approximately 16,000 sites on air,

  • Network now covers 133 million POPs in 35 metro areas across the U.S.

  • Streaming media now consumes over 50% of downlink traffic on Clearwire regardless of device type.

  • Retail cost per gross addition (CPGA) was $288 in the third quarter 2011 compared to $313 in second quarter 2011.

  • The company believes it has sufficient liquidity for the next 12 months but is looking for new funding.

  • Clearwire may sell excess spectrum to fund its LTE rollout.

  • The MOU with Sprint is still being discussed but there remains a gap.

See also