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Hesse: Sprint Not a Risk Despite Big Investments

NEW ORLEANS -- International CTIA Wireless -- Sprint Corp. (NYSE: S) CEO Dan Hesse shook off suggestions here that the operator could be a bankruptcy risk.

The topic came up when Hesse filmed a slot for Jim Cramer's Mad Money live at the CNBC booth at the convention center. Cramer noted that the company is spending big on the iPhone and asked if this massive spend could be a risk for the company.

There has recently been talk of Sprint being a possible bankruptcy risk. Much of this speculation comes from a report issued in March by Sanford C. Bernstein & Co. Inc. analyst Craig Moffett, which described a bankruptcy filing as "a very legitimate risk." (See Sprint: A Bankruptcy Risk?)

Hesse acknowledged that Sprint has taken on two significant investments -- subsidizing the iPhone and upgrading its 3G and 4G network at the same time -- but suggested that as long as the company "executes well" that investments will be a long term benefit rather than a problem. (See Sprint Sees iPhone Subsidies as Necessary Evil.)

"I don't see it as a risk," Hesse told Cramer and the large crowd watching.

Hesse noted that the company had raised billions. The debt market is "eager" to invest in Sprint, the CEO claimed. (See Sprint Chases $3B in Vendor Financing.)

— Dan Jones, Site Editor, Light Reading Mobile

Flook 12/5/2012 | 5:33:34 PM
re: Hesse: Sprint Not a Risk Despite Big Investments

Another way to look at it is, should Sprint go broke, spending on its network might make it a more valuable asset for someone else.

joset01 12/5/2012 | 5:33:39 PM
re: Hesse: Sprint Not a Risk Despite Big Investments

Yeah, I get that, but he had something of a point this time. Sprint probably isn't going to go under but it needs to swim hard against the current rather than treading water to power through this big spend.

Syrus_T_Justice 12/5/2012 | 5:33:42 PM
re: Hesse: Sprint Not a Risk Despite Big Investments



Craig Moffett is a shill for AT&T and has always taken every opportunity to kick Sprint in the shorts....... for every Moffett running around screaming the sky is falling I can find another less bias analyst that will say, while the spending on the three major items is a balancing act, long term the benefit to the company and its shareholders is great……..




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