Clearwire Corp., the wireless provider that is partially owned by Sprint Nextel Corp., on Thursday said it expects revenues of $332 million in the third quarter, reflecting 126 percent growth year over year.
The mobile broadband company, which offers wireless service directly and through wholesale relationships with Sprint and others, posted select preliminary 3Q financial results ahead of a financial conference in Scottsdale, Ariz.
Washington state-based Clearwire expects to add 1.9 million wholesale subscribers and end the third quarter with 9.5 million total customers, up from 7.65 million subscribers in the second quarter.
Based on that forecast, it appears Clearwire may have lost some retail customers or 3Q growth was stagnant or negligible.
Clearwire also said it expects to report an improved adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss of more than 50 percent compared to the pro forma adjusted EBITDA loss in the second quarter. In the second quarter, net loss from continuing operations attributable to the company totaled $160.5 million, or $0.65 per basis share. Clearwire did not specify its projected net loss for the third quarter.
The company anticipates ending the quarter (Sept. 30, 2011) with about $700 million in cash, cash equivalents and investments.
Clearwire cautioned that its numbers are just preliminary results subject to being finalized, and the company plans to release its full results in the coming weeks.
Shares of Clearwire were up 22 cents Thursday, or 16.92 percent, to $1.52 as of 11:30 a.m. ET.
Clearwire operates a fourth-generation WiMAX network, but its partner Sprint recently announced plans to move to another technology, Long Term Evolution, or LTE. Sprint will discontinue its WiMAX offerings by the end of next year, and it is estimated that the company will need to spend up to $5 billion to over the next three to five years to upgrade its infrastructure and build an LTE network, according to Zachs Equity Research.
Clearwire also plans to move to LTE. The company has announced a plan to overlay its WiMAX network with a Time Division LTE network for around $600 million, according to an August research note from J.P.Morgan. The company could start development next year, analysts with J.P.Morgan wrote, and complete the network in about a year.
“The company will need funding for this however,” the analysts wrote on Aug. 3, “and we are not optimistic about sources.”