Sprint Nextel Corp.’s (S) losses widened more than analysts expected in the first quarter, but the struggling service provider did snag a small coup: It shed the lowest number of subscribers than it has in about three years.
“We continue to make progress in improving the business,” Sprint CEO Dan Hesse said in a prepared statement.
Indeed, the nation’s third-largest mobile carrier lost 578,000 postpaid customers, down from 1.25 million a year earlier. Analysts had expected Sprint to bleed between 600,000 and 775,000 valuable contract subscribers. Sprint offset those losses, though, with the addition of 348,000 prepaid users, as well as 155,000 wholesale customers. The company’s growing line of smartphones contributed to the gains.
Overall, Sprint lost $865 million, compared to $594 million in the first quarter of 2009. That’s a 46 percent difference. Revenue fell as well, although not as much – sales dropped 1.5 percent to $8.09 billion. All told, Sprint has lost nearly $35 billion in the past three years; $29 billion of that stemmed from the takeover of Nextel.
“I never said Sprint’s turnaround would be quick or be easy,” Hesse told analysts on a conference call on Wednesday, according to BusinessWeek. “I hope you’ll agree that the trajectory of a number of important performance metrics are beginning to improve despite industry headwinds.”
Sprint has suffered multiple quarters of financial losses, layoffs and operations cutbacks as it faces intense competition from AT&T Inc. (T) and Verizon Wireless (VZ). It’s trying to combat those larger companies with the purchase of Virgin Mobile USA; problem is, the prepaid wireless market is nearing saturation. Sprint also partners with WiMAX provider Clearwire Corp. (CLWR), in hopes that 4G mobility will create strong revenue.
Shares of Sprint were trading 4.65 percent higher at about 11:30 a.m. Eastern on Wednesday, at $4.28.