Close
  • Latest News
  • Cybersecurity
  • Big Data and Analytics
  • Cloud
  • Mobile
  • Networking
  • Storage
  • Applications
  • IT Management
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Menu
eWEEK.com
Search
eWEEK.com
  • Latest News
  • Cybersecurity
  • Big Data and Analytics
  • Cloud
  • Mobile
  • Networking
  • Storage
  • Applications
  • IT Management
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home Android
    • Android
    • Apple
    • Mobile

    Sprint Adds 173K Postpaid Customers, but Q1 Loss Widens to $320M

    By
    TODD R. WEISS
    -
    July 25, 2016
    Share
    Facebook
    Twitter
    Linkedin
      Sprint

      Sprint has reported net operating revenue of $8 billion for the first fiscal quarter of 2016, which equaled its total for the same quarter in 2015, while its net operating loss widened to $302 million from a $20 million loss one year ago.

      The loss includes $113 million in non-recurring contract termination charges primarily related to the termination of a prior wholesale arrangement with Ntelos Holding Corp., according to Sprint, which announced its first-quarter figures on July 25. The report also included operating income of $361 million, which fell from $501 million one year ago.

      Sprint lost 8 cents per share, compared to a 1-cent-per-share loss one year ago.

      The number-three mobile carrier did have some positives in its earnings report, however, as it announced the addition of 173,000 Sprint-branded postpaid mobile phone customers for Q1, as well as a 1.39 percent churn rate for the quarter, which the company said is its lowest-ever churn rate.

      The company’s $302 million quarterly loss continues a streak of quarterly losses that has been going on for a decade at the company, but its leaders remain optimistic about its future.

      “We had another quarter of solid progress in our turnaround with the highest first-quarter postpaid phone net additions in nine years, the lowest postpaid phone churn in company history, and finally being postpaid net port positive against all three national carriers after five years,” Sprint CEO Marcelo Claure, said in a statement. “We also grew wireless net operating revenue year-over-year while aggressively reducing the cash operating expenses of the business and our network is performing better than ever.”

      Overall, the company reported 377,000 net mobile customer additions in the quarter, including postpaid net additions of 180,000, prepaid net losses of 331,000, and wholesale and affiliate net additions of 528,000, over its main Sprint nameplate and its other brands. The company’s overall postpaid churn of 1.56 percent in the quarter was unchanged for 2015, while its prepaid churn rate of 5.55 percent was up from 5.08 percent one year ago.

      Sprint also boasted of more than $550 million in year-over-year cost savings across the company and said that it “remains on track to achieve its goal of a sustainable reduction of $2 billion or more of run rate operating expenses exiting fiscal year 2016.”

      The company has also raised about $5.1 billion in cash through the temporary lease-back deals involving some of its cell tower equipment, according to earlier eWEEK reports.

      Several analysts contacted by eWEEK said that Sprint’s financial performance continues to be problematic.

      “Sprint’s earnings announcement attempts to create a pretty picture with ugly paints,” said Charles King, principal analyst at Pund-IT. “The company achieved its notable growth in postpaid customers by offering deep discounts and subscriber perks, contributing to Q1 revenues dropping to $8.01 billion [compared to $8.03 billion a year ago] and a loss of $302 million, or 8 cents per share, considerably wider than its year-ago loss of $20 million, or 1 cent per share.”

      On the plus side, “Sprint barely beat analysts’ expectations of a 9-cent-per-share loss, and the company’s management says it has raised enough cash to fund business through the fiscal year, including repaying debt maturities,” said King. “While there’s some minor good news here, Sprint’s Q1 earnings offer a portrait of a company that’s still fundamentally in trouble. After the dust settles from the planned acquisition of ARM Holding by Softbank [which owns 80 percent of Sprint], I expect Softbank’s efforts to sell Sprint will continue in earnest.”

      Chris Antlitz, a senior telecom analyst with Technology Business Research (TBR), said: “Sprint showed incremental improvement in its 1Q16 results, but the company’s long-term prospects are becoming increasingly dim.”

      One reason for concern, he added, is that the company’s capital expenditures were down 63 percent year-over-year. Antlitz called that reduction “incredible” and said it “portends future network problems.”

      Sprint is essentially shifting itself to a business model that will ensure its short-term survival, according to TBR. “Though TBR believes Sprint has adequate liquidity to pay its upcoming debt, the company is still in a bind from a competitive perspective because it will have little capital left to invest in its network, which continues to have chronic issues. Sprint is also limited in how much it can invest in new technologies like 5G and network-functions virtualization and software-defined networks, which severely impacts the company’s ability to compete over the long term against its increasingly stronger competitors.”

      The company is essentially “mortgaging its future to survive the short term, which is just delaying the inevitable, which is that Sprint will either have to ultimately file Chapter 11 bankruptcy and reorganize into a stronger entity, or be acquired by another company,” according to TBR.

      MOST POPULAR ARTICLES

      Android

      Samsung Galaxy XCover Pro: Durability for Tough...

      CHRIS PREIMESBERGER - December 5, 2020 0
      Have you ever dropped your phone, winced and felt the pain as it hit the sidewalk? Either the screen splintered like a windshield being...
      Read more
      Cloud

      Why Data Security Will Face Even Harsher...

      CHRIS PREIMESBERGER - December 1, 2020 0
      Who would know more about details of the hacking process than an actual former career hacker? And who wants to understand all they can...
      Read more
      Cybersecurity

      How Veritas Is Shining a Light Into...

      EWEEK EDITORS - September 25, 2020 0
      Protecting data has always been one of the most important tasks in all of IT, yet as more companies become data companies at the...
      Read more
      Big Data and Analytics

      How NVIDIA A100 Station Brings Data Center...

      ZEUS KERRAVALA - November 18, 2020 0
      There’s little debate that graphics processor unit manufacturer NVIDIA is the de facto standard when it comes to providing silicon to power machine learning...
      Read more
      Apple

      Why iPhone 12 Pro Makes Sense for...

      WAYNE RASH - November 26, 2020 0
      If you’ve been watching the Apple commercials for the past three weeks, you already know what the company thinks will happen if you buy...
      Read more
      eWeek


      Contact Us | About | Sitemap

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Property of TechnologyAdvice.
      Terms of Service | Privacy Notice | Advertise | California - Do Not Sell My Info

      © 2020 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

      ×