Sprint Adds 967K Customers Overall, Net Revenue Down in Fiscal Q3
The nation's third-largest mobile carrier also saw its Q3 net loss more than double to $2.4 billion, up from a net loss of $1.04 for the same period one year ago.Sprint added some 967,000 new wireless customers in the third quarter of 2014, but the company's net operating revenue was down by 1.8 percent and its net loss more than doubled from the same quarter one year ago. In a Feb. 5 announcement, Sprint also reported that it logged 30,000 postpaid net additions to its mobile customer base for the quarter, while it saw its postpaid churn rate increase from 2.07 percent a year ago to 2.3 percent.
"Sprint remains in rebuild mode entering 2015, with a focus on turning around its postpaid subscriber growth to help improve wireless revenue and margin growth," wrote Costa. "The operator showed signs of progress in 4Q14 with improved subscriber retention and strong prepaid growth. However, Sprint continued to trail far behind the Tier 1 competition in terms of postpaid net additions."
One problem the company could have in 2015 is that its Cut Your Bill in Half promotion may not bring in the customers and revenue that Sprint needs, wrote Costa. "TBR believes the promotion will be more successful retaining subscribers and attracting lower-end customers using inexpensive devices, yet will be less effective in drawing in higher end-customers, such as iPhone users. Total savings for higher-end customers may be minimal as they will need to purchase an expensive unsubsidized handset which may potentially offset the discount on their service plans."In early August 2014, Sprint dropped its plans to buy T-Mobile after the move was opposed by regulators, according to reports at the time. Sprint had been rumored for months to be seeking a merger with T-Mobile so that the two struggling companies could join together and fight harder to compete with mobile powers Verizon Wireless and AT&T. Neither company ever commented publicly on those rumors until Sprint finally said in August that it was giving up its plans. Following the aborted merger attempt, Sprint then shook up its executive ranks by replacing its CEO, Dan Hesse, with Marcelo Claure, the founder and CEO of Brightstar, a subsidiary of Softbank, Sprint's parent company. Since August, the big four carriers—Sprint and its three major U.S. competitors, AT&T, T-Mobile and Verizon—have been continuing to pummel each other over prices, data packages and other features in the war for more customers and revenue.
In November 2014, Sprint announced disappointing financial results for the second fiscal quarter of 2014, having lost $192 million on consolidated net operating revenue of $8.5 billion, according to an earlier eWEEK report. Sprint lost some 272,000 postpaid customers in Q2 and announced that another 2,000 employees would lose their jobs as the company tried to save money and turn its financial performance around.