Verizon shed new light on its surprise decision to offer an unlimited data plan in February after years of resisting: it was losing customers in droves.
From the beginning of the year until the unlimited plan was unveiled on Feb. 12, Verizon lost a net 398,000 regular monthly phone customers, by far the most it had ever lost in an entire quarter (the previous high was just 138,000, according to analyst Walt Piecyk at BTIG Research). Had that pace continued, it might have lost over 800,000 of its most lucrative accounts.
Instead, the carrier abandoned its opposition and rolled out an unlimited plan that was somewhat more expensive than plans from Sprint and T-Mobile, but which deeply undercut its own previous pricing plans for heavy data users and family plans. That turned the tide, and Verizon said it added a net 109,000 regular monthly phone customers in the second half of the quarter.
Putting the two periods together, Verizon still lost 289,000 postpaid phone customers, the most ever.
The smaller carriers had turned up the competitive pressure on Verizon earlier in the year. T-Mobile in January said it would stop adding additional fees and taxes to customers’ unlimited plan bills, an effective price cut of about 10%. Sprint started a promotion offering up to five lines of unlimited for only $90 for one year. Sprint’s Super Bowl commercial featured a man faking his own death to get out of a Verizon contract.
Get Data Sheet, Fortune‘s technology newsletter.
The customer loss revelations came as Verizon reported first-quarter results that disappointed Wall Street. Revenue of $29.8 billion slipped 7% from last year and missed the average analyst estimate by almost $700 million. Adjusted earnings per share of 95 cents were down 10% from a year ago and missed estimates by 1 cent.
Verizon’s stock price has already been battered since it admitted in January that it would not be able to increase its revenue in 2017 over last year. In premarket trading the shares dropped another 2%, making the total loss for the year 10%.
T-Mobile (TMUS) and Sprint (S) started the unlimited data wars last summer, when both carriers introduced new, low-cost plans. Verizon (VZ) and AT&T (T) eventually followed suit, benefitting customers. Cable giant Comcast (CMCSA) earlier this month unveiled its new wireless service, also with a focus on unlimited data plans.
But Wall Street has feared that the race to unlimited will hurt the bottom line. With weak results in wireless at Verizon–revenue fell 5% and an adjusted profit measure fell almost 8% for the quarter in the unit–those fears may only grow.