Sprint Nextel 2Q Profit Declines
Published on: 2nd Aug 2006
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Sprint Nextel made a modest revision to its 2006 forecast for consolidated revenue which the telecom carrier now pegs at $41 billion to $41.5 billion as opposed to $41 billion or more previously.
The updated top-line outlook reflects expectations for lower revenue from the company's wireless business, offset by expected revenue of $900 million to $1 billion from Sprint Nextel's acquisitions of Nextel Partners and UbiquiTel.
The company also said it anticipates beginning work on upgrading its network to deliver higher-speed mobile broadband services based on EV-DO Revision A technology during the fourth quarter.
In addition, Sprint Nextel said its board approved the repurchase of up to $6 billion of common stock over next 18 months.
Sprint Nextel Corp. reported second-quarter net income of $370 million, or 12 cents a share, down from $600 million, or 40 cents a share, earned in the same period during 2005.
Quarterly revenue from the telecommunications services provider reached $10.01 billion from $5.68 billion, reflecting the merger of long-distance carrier Sprint with wireless operator Nextel.
Earnings from continuing operations fell to 10 cents a share for the latest quarter from 22 cents a year ago.
Reston, Va.-based Sprint Nextel said earnings for the latest quarter included 19 cents of merger-related amortization expense and charges of 3 cents a share; the year-ago period included charges of 2 cents a share.
Analysts, on average, had been looking for earnings of 33 cents a share on revenue of $10.39 billion, according to estimates compiled by Thomson First Call.
Shares of Sprint Nextel added 61 cents, or 3.1%, to end Wednesday's trading at $20.13.
-Mike Maynard; 415-439-6400; AskNewswires@dowjones.com
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