Sprint adds 1.1M subscribers, halves 1Q loss

April 28, 2011 By PETER SVENSSON , AP Technology Writer
A Sprint sign is displayed at a store in Richmond, Va., Wednesday, April 27, 2011. Sprint Nextel said Thursday, April 28, it added more wireless subscribers in the first quarter than it has in five years, mainly on cheap service plans while it lost customers to Verizon's iPhone. (AP Photo/Steve Helber)

(AP) -- Sprint Nextel Corp. on Thursday said it added more wireless subscribers in the first quarter than it has in five years, mainly on cheap service plans, as its turnaround continued despite the new threat of Verizon's iPhone.

Sprint added a net 1.1 million in the January to March period as its contract-free and Boost brands raked in a record number of new subscribers.

Verizon's launch of the iPhone on Feb. 10 and AT&T Inc.'s price cut on an older iPhone model didn't leave Sprint completely unscathed. Sprint posted a net loss of 114,000 subscribers on contract-based plans, which are the most lucrative. People weighing between smartphones on Sprint and Verizon seem to have been tipped toward Verizon by the new iPhone.

But people who were already Sprint subscribers showed no inclination to abandon their contracts and move to Verizon. Sprint reported stronger loyalty among its contract subscribers than it's ever seen.

The effect of the Verizon launch on AT&T's quarterly results was similar.

Sprint has reported losses in every quarter for almost four years. The period ended March 31 was no different, with a net loss of $439 million, or 15 cents per share. But that was down from a of $865 million, or 29 cents per share, a year ago, and Sprint posted an operating profit for the first time since 2007.

Revenue rose 3 percent to $8.3 billion from $8.1 billion a year ago.

Analysts had expected a larger loss of 22 cents a share, and lower revenue of $8.2 billion.

Sprint shares rose 16 cents, or 3.3 percent, to 4.95 in morning trading.

The company has been holding the line on costs while subscriber trends have improved thanks to better customer service, a signature project of CEO Dan Hesse. In January, Sprint effectively raised prices by adding a $10 per month fee for new smartphones.

"Our strengthening brand helped us mitigate what otherwise would have been difficult to navigate: increasing our price in the face of a new iconic competitive device and widespread industry price pressure," Hesse said on a conference call.

Hesse has said that Sprint, and the health of the wireless industry as a whole, is threatened by AT&T's $39 billion deal to buy T-Mobile USA, the fourth-largest carrier. It would leave Sprint even further behind the top two carriers, AT&T and Verizon.

Speaking to analysts and investors on a conference call, he said many of them probably welcomed the combination because it would lead to higher, more stable prices and thus better profits in the industry. But they should pay attention to what diminished competition would do, he said.

Sprint's push to develop a fourth-generation wireless data network (now part of its Clearwire Corp. subsididary) pushed Verizon to develop its own 4G network, which in turn prompted AT&T to speed up its plans, Hesse said. The U.S. now has the largest 4G network in the world.

"The U.S. has regained wireless technology and innovation supremacy," Hesse said. "If Sprint had not been a legitimate ... competitive threat, the U.S. would still be a wireless also-ran."

Explore further: Sprint Nextel slows subscriber loss in 4th quarter

0 shares

Related Stories

Sprint Nextel slows subscriber loss in 4th quarter

February 10, 2010

(AP) -- Sprint Nextel says its subscriber losses slowed in the fourth quarter, an encouraging sign for the wireless carrier that has lost millions of customers over the past few years.

Sprint investors look for green shoots in first quarter

April 27, 2010

Sprint Nextel Corp. is expected to show another sharp decline in wireless customers when it reports quarterly results Wednesday, but investors might also see signs that the company's turnaround effort is setting roots.

Sprint Nextel posts first revenue gain in years

October 27, 2010

(AP) -- Sprint Nextel Corp. on Wednesday reported its first quarterly revenue increase in three years, as improvements in Sprint-branded and prepaid service offset the continued flight of subscribers from the Nextel network.

Sprint gains contract subscribers in 4Q

February 10, 2011

(AP) -- Sprint Nextel Corp. said Thursday it managed to post a quarterly net gain of contract subscribers for the first time since 2007, as its turnaround continues.

Recommended for you

Cellphones can steal data from 'air-gapped computers'

July 28, 2015

Researchers at the Ben-Gurion University of the Negev (BGU) Cyber Security Research Center have discovered that virtually any cellphone infected with a malicious code can use GSM phone frequencies to steal critical information ...

0 comments

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.