Clearwire Q4 Drops, WiMax News Doesn't
The CEO of the Kirkland, Wash.-based operator said on the company's earnings call today that Clearwire has made "significant progress" towards a revitalized partnership with its potential WiMax rival Sprint, and a deal might be sealed "soon." Analysts have been predicting a new partnership between the two since the first one fell apart last year.
A tie-up between the two service providers would help both to reduce the costs of deploying a nationwide WiMax network. Costs would be further reduced if rumored potential investors such as Google (Nasdaq: GOOG) and Intel Capital chip in.(See Clearwire-Sprint Deal Soon? and Sprint-Clearwire: On Again in 2008?.)
Cutting costs is something Clearwire desperately needs to do, as the venture has lost money ever since it was started by Craig McCaw back in 2003. The service provider blamed increased spending for an adjusted loss before interest, taxes, depreciation, and amortization of $83.1 million for the fourth quarter, compared with a loss of $62 million in the year-ago quarter. Revenues were up to $45.4 million from $23.7 million.
The firm reiterated its full-year 2008 forecast of $205 million to $215 million in revenues, based on expectations of a subscriber base of 510,000 to 530,000 users. The company closed 2007 with a subscriber base of around 394,000 users, each paying an average of $36 a month for its wireless service.
Clearwire's share price was battered on the results and lack of solid news about new partnerships and investments. By the end of the day, the company's shares were trading at $14.10, down $0.40 or 2.8 percent, but had dipped as low as $12.53 earlier.
— Dan Jones, Site Editor, Unstrung