Sprint's Loss Narrows on Higher Revenue
October 25 2016 - 09:50AM
Dow Jones News
Sprint Corp. reported a narrower loss in the latest quarter as
the wireless carrier continued to add customers and posted
year-over-year revenue growth for the first time since its 2013
takeover by SoftBank Group Corp.
Chief Executive Marcelo Claure said the company took "another
step forward in our plan toward sustainable profitability."
Sprint, which has attracted customers by offering its service
for half the price of its rivals, added 347,000 postpaid net
subscribers—its most-profitable type of customer—for its fifth
consecutive positive quarter after several years of losses.
"The top line is now growing, we continue to take costs out of
the business, and we are successfully raising money at materially
lower rates," Mr. Claure said in prepared remarks.
Since last October, Sprint has been stepping up its
belt-tightening and slashing costs. On Tuesday, the company said it
reduced overhead costs by $600 million year-over-year during the
second quarter, and that it is on track to cut $2 billion or more
of run-rate operating expenses at the end of the fiscal year, and
plans for more reductions in 2017 and after.
Still, Sprint has struggled with a continued perception that its
network is weaker than rivals, even as it has made
improvements.
In all for September quarter, Sprint posted a loss of $142
million, or 4 cents a share, compared with a loss of $585 million,
or 15 cents a share, a year ago. Revenue rose 3.4% to $8.25
billion.
Analysts polled by Thomson Reuters forecast a loss of 7 cents a
share on $8.03 billion in revenue.
Sprint's postpaid churn rate for the latest quarter, a measure
of service cancellations, fell to 1.52% from 1.54% a year ago.
The company backed its 2016 guidance for earnings before
interest, taxes, depreciation and amortization to be $9.5 billion
to $10 billion, up from $8.1 billion in 2015.
Japanese tech giant SoftBank bought control of Sprint in 2013
for about $22 billion aiming to shake up the business and steal
customers—a plan that has faced obstacles.
Shares of Sprint, up 47% over the past year, lost 3.5% to $6.68
in premarket trading.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
October 25, 2016 09:35 ET (13:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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