Sprint Announces $767 Million Net Loss in Third Quarter
Sprint Nextel today reported a net loss of $767 million on revenues of $7.3 billion during the third quarter of 2012. While this does represent a 6% year-over-year increase and a diluted net loss of $0.26 per share, the loss was less than expected and the company’s stock has not suffered today as a result.
Sprint claimed that much of the loss is due to its Network Vision plan, which includes massive upgrades to its network infrastructure and the expected shutdown of the Nextel platform.
“The Sprint platform performed well, with strong net subscriber additions, record third quarter postpaid and prepaid churn and robust revenue growth, contributing to adjusted OIBDA of $1.28 billion even as we continue to invest in Network Vision and position the company for future growth,” said Dan Hesse, Sprint CEO. “As a result, we believe we will slightly exceed the top of the range of our recently increased Adjusted OIBDA* forecast.”
Though, as Hesse mentioned, the Sprint platform added subscribers, customers have begun abandoning Nextel in droves, resulting in a loss of monthly subscribers to Sprint’s wireless services.
Still, even with its losses and shrinking subscriptions, Sprint could be in position for a resurgence next year. The company’s 4G LTE network is continuing to roll out across the U.S., matching AT&T and Verizon’s offerings. Sprint also announced that it sold 1.5 million iPhones in the third quarter, and Samsung’s Galaxy Note II smartphone is scheduled to launch on Sprint today.
The Softbank investment in Sprint and the T-Mobile/MetroPCS merger should mean better competition in the U.S. The unlimited data plans Sprint and T-Mobile offer could put pressure on the “shared” wireless data pricing of AT&T and Verizon.