Sprint Nextel Posts Best Customer Growth in Five Years As Losses Also Shrink

Published on: 26th Oct 2011

­USA based Sprint Nextel has announced that its third quarter revenues rose slightly, by 2 percent to reach US$8.33 billion as compared to a year ago, although they showed no growth compared to the previous three months.

The net loss also shrank to US$301 million compared to US$911 million last year.

The company achieved its best total company wireless net subscriber additions in more than five years. The company added nearly 1.3 million total net wireless subscribers, primarily driven by 304,000 net postpaid additions for the Sprint brand, net prepaid additions of 485,000 and net wholesale and affiliate additions of 835,000.

The company served more than 53 million customers at the end of the third quarter of 2011. This includes 32.9 million postpaid subscribers (28 million via the Sprint brand on CDMA, 4.7 million on iDEN, and 229,000 Nextel PowerSource users who utilize both networks), 14.3 million prepaid subscribers (11.9 million on CDMA and 2.4 million on iDEN) and approximately 6.3 million wholesale and affiliate subscribers, all of whom utilize the CDMA network.

Growth in Sprint brand net additions was achieved without the benefit of Apple's iPhone 4S and iPhone 4, sales of which started after the end of the financial quarter. Approximately 8 percent of postpaid customers upgraded their handsets during the third quarter. Upgrades as a percentage of the subscriber base declined slightly, which the company said was likely due to customer expectations of the iPhone launch.

"Sprint's focus on creating the best customer experience with simple, unlimited plans and innovative products and services continues to strengthen our brand and drive positive results," said Dan Hesse, Sprint CEO. "We are adding to our customer base, our ARPU is increasing, and as a result our wireless revenues are growing."

As of Sept. 30, 2011, the company's total liquidity was approximately $5 billion, consisting of $4 billion in cash, cash equivalents and short-term investments and $1 billion of undrawn borrowing capacity available under its revolving bank credit facility. The company's next scheduled debt maturities of $2.3 billion are due in March 2012.

Sprint Nextel expects net postpaid subscriber additions for the full year 2011 and to improve total net wireless subscriber additions in 2011, as compared to 2010. The company expects full year capital expenditures in 2011, excluding capitalized interest, to be approximately $3 billion. In addition, the company expects Free Cash Flow between negative $200 million and positive $100 million for 2011.

 

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