Light Reading

Sprint's Profit Dive

Dan Jones
LR Mobile News Analysis
Dan Jones, Mobile Editor
8/8/2007
50%
50%
Repost This

Sprint Corp. (NYSE: S) says it spent $51 million on WiMax during the second quarter of this year in preparation for a nationwide launch in April 2008.

That figure helped contribute to a 94 percent earnings drop for the quarter, the company said today. The carrier made a profit of $19 million on $10.16 billion in revenue in its second quarter, which ended June 30, down from income of $370 million on revenue of $10 billion a year ago.

Nonetheless, WiMax could eventually prove to be important for Sprint since wireless is the area in which the company is growing -- albeit not as fast as larger rivals AT&T Inc. (NYSE: T) and Verizon Wireless -- while wireline stagnates.

Wireless revenue for the quarter is up more than 3 percent from $8.8 billion, while fixed-line revenue is flat at $1.6 billion.

Sprint added 373,000 subscribers for the quarter but continued to lose some of its most valuable enterprise customers from the Nextel side of the house. By comparison, AT&T and Cingular both added more than 1.5 million customers this quarter.

Data revenues were a bright spot for Sprint, despite a seasonal decline in average revenue per user (ARPU) overall to just above $60 for monthly subscribers. Total data service revenues increased 4 percent from the previous quarter and 40 percent from the second quarter last year. Data ARPU was around $9.75, or about 16 percent of total ARPU. CDMA network users spent approximately $12.75 monthly for data.

Heavy data usage could be an early indicator that WiMax might be a success with Sprint users. The new network offers better-than-3G download speeds. It remains to be seen exactly how much the operator's network deployment deal with Clearwire LLC (Nasdaq: CLWR) will reduce its WiMax spending during the coming quarters. (See Clearwire & Sprint Team on WiMax.)

Sprint investors, however, are still suffering from bottom-line shock syndrome. The operator's shares dropped 45 cents, or 2.23 percent, to $19.77 during the day on the news of the drastic profit fall.

— Dan Jones, Site Editor, Unstrung

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Flash Poll
LRTV Documentaries
Cable Eyes Big Technology Shifts

4|16|14   |   03:02   |   (4) comments


US cable engineers are facing a lot of heavy lifting in the coming years, notes Light Reading Cable/Video Practice Leader Alan Breznick.
LRTV Custom TV
Maximizing Customer Experience & Assuring Service Delivery in an IP World

4|15|14   |   4:57   |   (0) comments


Steven Shalita, VP of Marketing, NetScout Systems, Inc., discusses the challenges cable/MSO operators face in assuring the delivery of new IP-based services. Key points include the value of proactively managing performance, and using rich analytics and operational intelligence to better understand service and usage trends, make smarter business decisions and ...
LRTV Documentaries
Bye-Bye DVD: Consumers Embrace Digital Video

4|10|14   |   04:17   |   (7) comments


Veteran video analyst Colin Dixon, founder and principal analyst of nScreenMedia, says research shows 56% are using digital video already.
LRTV Documentaries
Video: TW Cable Puts Multicast Gateways to the Test

4|8|14   |   04:13   |   (1) comment


Tom Gonder, a chief architect at Time Warner Cable, explains how its trial of multicast gateways is impacting IP-based video plans.
LRTV Custom TV
Managing & Monetizing Big Data in Operator Environments

4|7|14   |     |   (1) comment


At Mobile World Congress, Gigamon's Director of Service Provider Solutions, Andy Huckridge, and Heavy Reading Analyst Sarah Wallace discuss the 'big data' issues facing carriers and operators today.
LRTV Huawei Video Resource Center
Data Center Energy – Build Your Data Center in a Modular Way

4|7|14   |   2:13   |   (0) comments


Dr. Fang Liangzhou, VP Network Energy Product Line, shared his thoughts about the challenges for data centers during CeBIT 2014.
LRTV Huawei Video Resource Center
Agile Network Solution – An Overview of Huawei's Agile Network Solution

4|7|14   |   2:31   |   (0) comments


Ajay Gupta, Director of Product Marketing, Networking Product Line, gives an overview of the Agile Network Solutions during CeBIT 2014.
LRTV Huawei Video Resource Center
Huawei’s eLTE Voice Trunking, Video and Data Applied for Railways

4|7|14   |   1:38   |   (0) comments


Gottfried Winter is the Sales Director at Funkwerk, a German specialist in GSM-r terminals and a long-time partner of Huawei. At CeBIT 2014, Winter talks to Light Reading about this partnership and the integration of enhanced voice trunking, video and data functions.
LRTV Huawei Video Resource Center
LeaseWeb Speaks Highly of Huawei's Datacenter Products

4|7|14   |   1:37   |   (0) comments


Rene Olde Olthof, Operations Director LeaseWeb, talks about the next data center transformation during CeBIT 2014.
LRTV Documentaries
Comcast: Reshaping the Cable Network Architecture

4|3|14   |   07:11   |   (8) comments


Shamim Akhtar, Comcast's architect and senior director of network strategy, explains why the cable company is moving to a more distributed network architecture.
LRTV Custom TV
VMware CEO Pat Gelsinger at Mobile World Congress

4|1|14   |   3:41   |   (0) comments


VMware CEO Pat Gelsinger speaks to Heavy Reading about the value of virtualization spanning from the data center to service provider networks to mobile devices.
LRTV Huawei Video Resource Center
Analysts' Impressions of Huawei SoftCOM at ONS 2014

4|1|14   |   1:11   |   (0) comments


After visiting the Huawei booth at ONS, Lee Doyle of Doyle Research gives his appraisal of Huawei's SoftCOM solution.
Hot Topics
BlackBerry Invests in Healthcare IT Startup
Sarah Reedy, Senior Editor, 4/15/2014
Volvo: AT&T HSPA+ Can Drive My Car
Sarah Reedy, Senior Editor, 4/16/2014
T-Mobile Petitions Operators to Kill Overages
Sarah Reedy, Senior Editor, 4/14/2014
Cisco & VMware Are Apple & Google of SDN
Mitch Wagner, West Coast Bureau Chief, Light Reading, 4/14/2014
Mobile Apps Susceptible to Heartbleed, Too
Sarah Reedy, Senior Editor, 4/14/2014
Like Us on Facebook
Twitter Feed