MetroPCS 3Q profit falls on higher expenses

Wed Nov 5, 2008 8:09 AM EST

technology, earnings, metropcs-communications, metropcs

MetroPCS Communications Inc. said Wednesday its third-quarter profit dropped 15 percent, weighed down by higher operating expenses.

The cell phone company reported earnings fell to $45 million, or 13 cents per share, for the three months ended Sept. 30 from $53 million, or 15 cents per share, a year earlier.

Quarterly revenue increased 23 percent to $687 million from $557 million on 25 percent growth in service revenue.

Analysts surveyed by Thomson Reuters expected net income of 15 cents per share on revenue of $711.3 million. Analysts' estimates typically exclude one-time items.

Operating expenses rose to $566.1 million from $423.6 million. Cost of service climbed to $219.4 million from $163.7 million, while cost of equipment grew to $160.5 million from $131.2 million. Selling, general and administrative expenses increased to $116.7 million from $84.5 million.

The company maintained that it added about 249,000 net subscribers during the quarter.

MetroPCS provides flat monthly rates, no contract and unlimited minutes where it offers service.

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