Sprint Pins Hopes on WiMax Phone
Sprint Corp. (NYSE: S) revealed high hopes for the upcoming launch of its first WiMax smartphone, the High Tech Computer Corp. (HTC) (Taiwan: 2498) EVO 4G, as it reported first-quarter results today.
So high in fact, that the company is clearly hoping the new WiMax device, which uses the Android operating system, will give Sprint a much needed boost in its financial turnaround efforts. (See Sprint Launches 3G/4G Android Phone, CTIA 2010: Sprint Goes Supersonic, and Details on Sprint's EVO, and CTIA 2010: Hesse – LTE Will Be Bigger But We Are First.)
"We look forward to the launch of the HTC EVO 4G device, which we hope will provide a tailwind to our momentum," said Dan Hesse, CEO of Sprint on the earnings conference call with analysts and media today.
The "momentum" he referred to is improvements on some key operating metrics, such as operating revenue increases and progress in providing better customer care.
"I never said Sprint's turnaround would be quick or easy," said Hesse.
Indeed, Sprint posted a first-quarter net loss of $865 million, or $0.29 per common share, on revenues of $8.1 billion. The quarterly net loss is a whopping 46 percent bigger than the $594 million loss the carrier reported in the same quarter last year. Part of the reason for the larger loss is the inclusion of a non-cash $365 million tax-related charge. (See Sprint Reports Q1.)
Sprint's quarterly revenues of $8.1 billion were down 2 percent compared with the same quarter last year, but 3 percent higher than in the previous quarter. Sprint pointed out that this is the first time it has reported sequential quarterly revenue growth in three years.
The year-on-year revenue decline is mostly due to lower post-paid wireless service revenues and wireline revenues.
Sprint lost a total of 75,000 customers in the quarter, bringing its total customer base to 48.1 million at the end of the first quarter. The carrier lost 578,000 post-paid, or contract, customers in the quarter, of which 131,000 were on the CDMA network and 447,000 were on the iDEN network.
But Sprint noted that the loss of contract customers was actually an improvement on the previous year. Sprint said that it lost 670,000 fewer subscribers than it did in the first quarter of 2009. So, that's good then.
Sprint, which uses Clearwire LLC (Nasdaq: CLWR)'s network to offer WiMax services, did not disclose the number of WiMax customers it has signed up so far. The "Sprint 4G" WiMax service is available in 28 markets covering 40 million people.
— Michelle Donegan, European Editor, Light Reading Mobile