Sprint (S) Up on Improved 4th Quarter Results
Shares of Overland Park, Kansas, based Sprint Corporation (S) closed higher on Tuesday, up 21 cents per share, or 2.73%, to close at $7.90, on volume of 44,210,253 shares. The company reported that its fourth-quarter net loss was lower than what had been forecast by advanced estimates. The company's total revenue increased, and the number of monthly subscribers declined far less than analysts predicted.
Sprint is a telecommunications holding company, offering wireless service as well as global Internet service.
It is the third largest mobile phone service provider in the United States, serving nearly 54 million subscribers. The company offers broadband and other services through its Boost Mobile, Virgin Mobile, and Assurance Wireless subsidiaries. The majority interest in the company is owned by SoftBank Corporation of Japan, which holds an 80% interest. On Tuesday the company announced a fourth quarter net loss of $.26 per share, which was seven cents lower than advanced estimates. Total revenue reached $9.14 billion, an increase of 1.5%, and well ahead of the $8.69 billion analysts had predicted. Sprint recorded a record 53.9 million subscribers, and while that was 69,000 fewer than the previous quarter, it was considerably less than the 371,000 lost subscribers that analysts had forecast. Overall, the net loss for the quarter was $1.04 billion, well below the loss of $1.32 billion that had been recorded in the fourth quarter of 2012. This included $1.5 billion in depreciation and write offs related to the Nextel unit that was shut down during 2013. The operating loss for the quarter was $576 million, down from a $738 million loss in the fourth quarter of 2012. Sprint ended the quarter with 53.9 million subscribers, up from 53.5 million in 2012. This indicates the company's subscriptions are rising after years of losing customers to other carriers, such as Verizon Wireless (VZ
) and AT&T (T
). Sprint added 58,000 postpaid subscribers, 322,000 prepaid subscribers, and 302,000 wholesale and affiliate subscribers during the quarter. The company sold 5.6 million smart phones during the fourth quarter, and 20.5 million for all of 2013. The company also reported that LTE coverage is now available to more than 200 million people. The company continues to expect that by the middle of this year LTE coverage will reach 250 million people. LTE, or "Long Term Evolution", is the fastest data network technology currently available, and one in which Sprint has trailed Verizon Wireless and AT&T. Sprint's share price has fallen by about 25% in 2014, as hopes had faded of a consolidation with T-Mobile (TMUS
). It was hoped that some kind of deal with T-Mobile, a smaller competitor, would better enable Sprint to compete with both Verizon Wireless and AT&T, the largest providers in the industry. Said Sprint CEO Dan Hesse, "I believe that further consolidation in the U.S. wireless industry outside of the big two - AT&T and Verizon because they're so large - would be healthy for the competitive dynamic of the industry, would be better for the country and better for consumers..." The fourth-quarter report offers a glimmer of hope that Sprint is now beginning to make progress in overcoming its obstacles, even without a deal with T-Mobile. Other News About Sprint Sprint and T-Mobile: What's Likely To Occur?
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Published on Feb 12, 2014
By Kevin Mercadante