T-Mobile USA CEO Slams Verizon and Comcast in Latest Earnings Call

Updated from April 24.

T-Mobile USA (TMUS) 's first-quarter earnings call after the market close on Monday was a mix of financial commentary and trash talking, with CEO John Legere jeering Verizon's (VZ) recent report and predicting failure for Comcast's (CMCSA) wireless joint venture.

The T-Mobile CEO touted the gain of 1.1 million net subscribers -- which marked the fourth straight year that that carrier had added at least one million customers per subscriber -- and largely derided a "stupid, arrogant industry" that had been slow to change and predicted the formation of a national cable and wireless network.

As the government quiet period limiting talks between participants in a recent spectrum auction ends Thursday, Legere suggested big changes afoot, which he said could include Alphabet's  (GOOGL) Google or Amazon (AMZN) joining the mix of telecoms and cable service providers to some degree.

The telecom said it earned $698 million, or 80 cents per share, in the first quarter, compared with net income of $479 million, or 56 cents a share, for the first three months of 2016. But revenue of $9.55 billion came in just under forecasts of $9.62 billion.

Shares of T-Mobile slumped 1.4% in after-hours trading Monday but were up 2.8% to $66.49 in Tuesday morning trading.

Legere contrasted T-Mobile's performance with the "disaster of a quarter" that Verizon posted last week, with a loss of 289,000 post-paid phones during the first quarter.

"That's really got to be embarrassing after all of that mic dropping," Legere said, referring to an ad announcing Verizon's unlimited mobile plan in mid-February.

Since going unlimited, the T-Mobile CEO said, Verizon's network had gotten "noticeably slower" making it "slower than AT&T (T) ."

Legere was no kinder in remarks about Comcast's wireless joint venture with Verizon, which Legere called "the biggest non-announcement ever in the history of the wireless industry." The Philadelphia cable operator is "by far the most hated corporation on the planet," the T-Mobile CEO said.  

"They are arrogant (and) they are going to fail miserably in this industry," Legere added of Comcast, predicting the cable company would be involved in further consolidation to expand its offerings.

T-Mobile was the top bidder in a recently concluded government auction of wireless spectrum licenses, placing nearly $8 billion in winning bids. T-Mobile management said that the spectrum will allow it to expand its network into new areas. Additionally, T-Mobile plans to open 3,000 stores this year. Management said that the spectrum gains and the new retail outlets were emblematic of the carrier's growth.

Anticipation of strategic moves has been building with the conclusion of the auction. On Thursday, restrictions on talks among companies that took place in the auction will expire. 

"There is this huge, pent-up energy because it's been over a year since people could have conversations," Legere said. Companies such as satellite TV provider and wireless spectrum hoarder Dish (DISH) , mobile carrier Sprint (S) and Comcast "need to do something to complete their hand," Legere told investors.

"All content will go to the mobile internet," Legere said and "nobody has the full portfolio of capabilities" of network and content assets that the market ultimately will demand, suggesting that Google and Amazon could play a bigger role in communications.

Moreover, Legere suggested a "national footprint around cable and wireless needs to be created at some point."

Comcast and Alphabet are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells CMCSA or GOOGL? Learn more now.

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