Sprint reported a consolidated net loss of $498 million in its 3r...
Sprint reported a consolidated net loss of $498 million in its 3rd quarter, reversing year-ago net income of $519 million, and said its consolidated net operating revenue dipped 1.2% to $6.7 billion. It said the results included a charge…
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of $768 million due primarily to a write-down on special items related to a revaluation of the company’s MMDS spectrum that lowered the asset’s carrying value to $300 million. Previous year results for the same quarter included a net gain of $260 million from special items and net income of $42 million from a discontinued operation. The FON Group said it lost $433 million after having a profit of $526 million a year earlier, and net operating revenue fell 7.3% to $3.5 billion. In its Local Div., it said revenue declined 3.2% to $1.5 billion, despite gains in bundled service customers. FON said consumer bundle penetration increased 700 basis points to more than 31% and business bundle penetration 400 basis points to 26%. The group said its DSL subscribership grew 41,000 in the quarter to 264,000, while total access lines declined at a 2.2% annual rate, compared with 2.4% in the 2nd quarter. In its Global Market Div., Sprint said net operating revenue dropped 12% to $2 billion, driven by a 15% decline in voice revenue. “Consumer revenues continued to be impacted by product substitution and aggressive competition,” the group said. The PCS Group said it widened its net loss for the quarter to $65 million from a $7 million a year earlier, but said its net operating revenue grew 5.8% to $3.3 billion. It said it had 19.3 million customers at the end of the quarter after adding 184,000 postpaid retail users, 290,000 through its wholesale channels and 22,000 through its affiliates. It said its churn was 2.7% for the quarter, compared with 2.4% sequentially, but remained lower than 3.8% a year ago. For the full year, Sprint said it expected FON operating income adjusted for special items to be $1.85 billion to $1.90 billion, up from its earlier forecast of $1.80 billion to $1.85 billion. It said it expected capital expenditures of $1.7 billion, down $100 million from its previous forecast. The company confirmed its forecast for the PCS Group, saying it was expected to report full-year operating income adjusted for special items of $800-$900 million. It said it also anticipated the group would have gross customer additions “in the low- to mid-6 million range.” Sprint revised PCS full year free cash flow to $300 million, up from its estimated $200 million due to reduced working capital requirements.