Sprint reported today a second-quarter net loss of $1.6 billion, or 53 cents per share, compared with a loss of $1.4 billion, or 46 cents per share, in the year-ago quarter. Revenue rose to $8.87 billion from $8.84 billion over the same period. On average Wall Street analysts had expected revenue closer to $8.7 billion, according to Thomson Reuters.
Japanese SoftBank paid $21.6 billion to acquire Sprint on July 10 after months of competition with rival bidder Dish Network Corp. SoftBank already helped Sprint (previously the majority owner of Clearwire Corp), to take full control of that company in order to gain access to Clearwires strong capabilities of wireless coverage in order to boost Sprints network.
Sprint lost 1.045 million contract customers in the quarter, more than the average estimate for a loss of almost 972,000 by four analysts contacted by Reuters. Their estimates ranged from a loss of 885,000 to 1.1 million customers. That is the highest subscriber loss in four years.
However, Sprint, is working on a network upgrade aimed at competing with its bigger rivals. Company said it would have a 2013 spending budget of about $8 billion, in line with previous forecasts around the time of the SoftBank deal. While Sprint has struggled for years to catch up with its bigger rivals, analysts now expect the company to become a much stronger competitor with the help of Japanese firms Chief Executive and founder Masayoshi Son.
Sprint said it expects 2013 adjusted operating income before depreciation and amortization (OIBDA) between 5.1 billion to $5.3 billion, including non-cash one-time costs related to its SoftBank deal and its July buyout of Clearwire. Excluding costs related to the deals, the telecom said its 2013 target was for adjusted OIBDA between $5.5 billion and $5.7 billion, which is ahead of its previous forecast that it would reach the high end of a $5.2 billion to $5.5 billion range.
Sprint may be the only major carrier to lose contract customers in the second quarter. Verizon Wireless added 941,000 monthly subscribers, while AT&T gained 551,000. T-Mobile also added monthly contract customers last quarter for the first time in three years, according to people familiar with the matter. The company is due to report results on August 8.
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