Sprint Corp. shed 2 million subscribers and lost $1.6 billion in the
three months leading up to its buyout deal with Tokyo-based SoftBank Corp.
The subscriber losses largely reflected the June 30 shutdown of the old Nextel network it gained in a 2005 merger and the culling of unqualified customers receiving month-to-month service under a federal cellphone program.
Sprint's customer losses left it with 53.6 million subscribers, its smallest count since September 2011.
More than 1 million of the defections involved customers with service contracts. At the same time, Verizon had added 941,000 customers under contract and AT&T 551,000. Expectations are that T-Mobile will show gains in its contract customer count when it reports its results next week, despite three years of shedding contract customers.
Sprint has been losing Nextel customers to other carriers since announcing in May 2012 that the old network would shut down June 30 of this year. More than 4 million Nextel customers moved to Sprint's own network since it began to upgrade that network in early 2011.
Financially, Sprint's loss of $1.6 billion equaled 53 cents a share. A year ago, the Overland Park-based company had lost $1.4 billion, or 46 cents a share. Some of the losses involved the Nextel shudown and other events that did not drain company cash.
But Sprint said it operated at a loss, too, though revenues totaled $8.9 billion compared with $8.8 billion a year ago.
Sprint is spending heavily to upgrade its network, pushing total capital investment in the quarter to $1.9 billion. It expects to invest $8 billion this year in total.
The report covers Sprint's results prior to its early July purchase of Clearwire Corp., its wireless network partner, and SoftBank's acquisition of 78 percent of Sprint for $21.6 billion.
To reach Mark Davis, call 816-234-4372 or send email to email@example.com.
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