How Long Has Hesse Got?
The third-ranked cellular operator posted another set of downbeat results today, with a 10 percent drop in revenues. Sprint managed to slow the rate of monthly wireless subscribers defecting, but otherwise the results were pretty much the same story we've seen for quarter upon quarter now.
It is not Hesse's fault that Sprint is in this mess. The operator's troubles started when it inked the merger deal with Nextel in the third quarter of 2005. Customer defections started then, and the operator has never really got the situation under control since. (See Sprint: Profits Up, Subs Stall and Hard Times: Sprint Loses 1.3M Customers in Q4.)
Nonethless, former CEO Gary Forsee left early in October 2007 under pressure from angry investors, partly because of Sprint's subs problem. At the time, Sprint's shares were seeing lows around $18.05.
Hesse joined as Sprint CEO in December 2007, just in time to get clobbered by the economic downturn. (See Sprint Nextel's New Broom.) At the time, Hesse promised "decisive actions" to turn the company around.
Between then and now, Hesse & Co. have cut thousands of jobs, decided to spruce up iDEN, given Sprint's WiMax assets over to Clearwire LLC (Nasdaq: CLWR), and outsourced network management to Ericsson. Yet still the operator continues to lose customers. (See Sprint, Clearwire Form WiMax Giant, Ericsson, Sprint in $5B Managed Services Deal and Sprint 'Committed' to iDEN .)
Sprint's shares are at $4.05 today.
Which leads me to wonder: How long has Hesse got left before Sprint's investors start to get restless again?
— Dan Jones, Site Editor, Unstrung