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T-Mobile is concerned. See, they’re doing rather well as far as subscribers go. They keep adding and adding, and although they’re still significantly behind Sprint, the nation’s No. 3 wireless carrier, they’re steadily gaining ground, while Sprint loses it. Their concern is with investors, who might not see a tidy number under the company’s profit column. This is because they’re out spending money on improvements, in hopes that this investment pays off at a later date. But for the time being, we can expect to see narrow profit margins for the nation’s No. 4 wireless carrier.

The money is going to be spent in an effort to keep up with the rapid increase in wireless service speeds. T-Mobile does have a 3G network waiting in the wings, but even as they launch that, rivals AT&T and Verizon are already planning their fourth generation networks. And so T-Mobile will eventually have to spill funds into that if they want to keep up.

CEO Robert Dotson thinks that his company is on the right path, profit margins or not:

“If you look at where our margins are today — low 30, 31, where we’ve been over the last 12 months — clearly there’s a path for us that we feel good about getting to that mid-30s area,” Dotson said. “If I look out over the three years, the cost impact will keep us from hitting some of the mid-30s margin numbers in the next two years.”

Once the fourth quarter numbers are released, T-Mobile will have broken the 28-million subscriber mark. Unfortunately, despite losing many subscribers, Sprint is expected to still have 41 million subscribers when their fourth quarter data is reported.

Honestly, we’d rather see T-Mo put in the money and try to catch Sprint, rather than cater to investors. Then again, we’re not investors, so what the heck do we know?

[Bloomberg]

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