Good news for Leap Wireless, which released some Q4 operational stats: Despite a lagging economy, the cheap, pre-paid wireless carrier had a solid quarter. Leap reported 152,000 net subscriber additions and 4.2% churn. That beat the company’s guidance of 70k – 130k net adds and 4.4% – 4.7% churn (the per cent of customers who leave the service each month). It also beat Jefferies & Company’s more bullish estimates: 98k net sub. adds and 4.7% churn.
In a note today, Jefferies said Leap’s customers are also spending more money each month with the service. During the third quarter of 2006, 90% of new subscribers picked Leap’s $45 monthly service. During the third quarter of 2007, only 25% chose a $45 service plan — about 65% chose a $50 or greater plan. More good news.
LEAP shares are trading around $45 today, up 18% from last night’s $37.84 close. But even with today’s jump, shares are down some 40% since their $80 days last September, when Leap turned down a ‘too-cheap’, $69-per-share acquisition offer from rival MetroPCS (PCS). Oops.
Next up for Leap: bidding in this month’s FCC spectrum auction, which could win the carrier more airwaves for future growth.