Sprint’s Q4: subscribers up, churn down; still losing money

By on Feb 10, 2011 at 12:56 PM
General February 10, 2011

Ladies and gentlemen, it is with great pleasure that I inform you that U.S. wireless provider Sprint, for the first time in thirteen quarters, has reported gains in post-paid subscribers. Ending its long drought, the Now Network added a total of 1.1 million new subs; 58,000 of which were post-paid. Sprint also reported a drop in churn during its earnings call, down to 1.86 in Q4 from 2.11 in Q3. It isn’t all good news, however. The company still posted a $929 million loss on revenues of $8.3 billion in Q4, or $0.31 per share. Sprint’s stock was trading slightly higher on the news.

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  • Anonymous

    This seems like good news. Right?

    • Anonymous

      Yeah, losing a billion bucks a quarter is spectacular!

      • http://twitter.com/dustbeta Dustin Schultz

        It’s all about the market expectations baby!

      • Supercop

        They allocatted profit toward cash an debt payment. They have $6b in cash. 4x more than at&t.

      • Majic

        Vz and att may have debt but take in way more money quartly and annually than Sprint. They just reinvest it either back into their networks or to attract exclusive phone deals.
        So having 6 billion on the books maybe great for Sprint but sucks for their customers if they do nothing with it.
        Having yet another carrier is good for us being it helps to regulate pricing, please don’t think for one second they are better off than vz and att money wise.

      • serpentor

        @Majic

        I think Sprint being #3 by a long margin doesn’t necessitate them reinvesting in infrastructure. And Sprint’s problem is not coverage.

  • Scorp

    This is what happens when you offer dirt cheap calling plans… More customers, still lose money. It’s good for the consumers pockets but not good for the company. Sooner or later they will have to raise prices starting with the $10 fee added. It’s the only way to stay in business. They don’t have to have AT&T/VZW prices but they will need to increase those AND stay up with devices. There’s just no way you can offer those cheap plans along with free everything and make money at the same time.

    • Publiuslocal

      Dirt cheap plans ….? OK but their device pricing is horrible and almost every in demand device comes with a MIR…….so Sprint is recovering the plan losses by not incurring device subsidies……199.00 for a nextel curve 8330?

      Chances are tower lease fees are killing them after their switch/tower sell off in 06-07………

    • Anonymous

      No, it’s more like this is what happens when you have the expense of running two incompatible networks while your competitors only have to run one. Profit margins get pushed way down.

  • http://infotainmentempire.blogspot.com Rob

    And now we know why the $10 charge to all smartphones is for…

  • Anonymous

    With their “special event” being a dual screen off brand junker, this will only get worse.

    • WTF

      Exactly. Their mediocre (at best) phone selection is penalizing them. Imagine them with a high-end droid (sorry for your denial but evo isnt high-end) or iPhone. Especially the latter if they had their current plans lined up with it.
      It probably wouldn’t be long before they were on the positive end of things.

      • Wildwilly

        The Evo isn’t high end lol … The Evo has better specs than the Iphone 4. Care to elaborate… sheep..bahhhhh sheep bahhhhhhh…bahhhhhhhh

      • SPGGUY

        .lol…you must not know anything about this industry becuase the EVO certainly is high end and I am pretty sure almost all would agree let me guess…you are a VZW fan boy?

      • migs

        SORRY to tell ya my friend that high end droid phones coming out now have the same specs the Evo had 5-6 month ago. the Evo is definetly a high end device, get ur facts straight.

      • WTF

        Like I said, I’m sorry for your denial. A phone that has a battery life of about 6 hours isn’t high end. And with phones coming out very soon with dual core processors the evo is weak. And to answer the other guy, no, I’m not with verizon.

      • TREAT

        Evo has millions of less colors on the screen than a droid 1. On a touch screen phone it should have a high end screen to be considered high end. and when you measure specs its far behind… Processor, ram, screen, memory. Come on… Stop wishing an outdated phone to be compared to current. E

      • serpentor

        @WTF

        EVO was released in June. How do you compare that to phones yet to be released?

        The original iPhone is so weak, DERP, the dual core phone ima getting in a couple months will own it. #applefail

      • Scorp

        Manufacturers don’t want to spend time making a bunch of devices for different radios. The whole Wimax thing is just dumb.

      • Anonymous

        I’m not sure how you set up your EVO…but six hours is way off. I run a day and half off of mine like clockwork.

        Not high end?

        Specs wise there still has yet to be massive separation from what the EVO originally brought to the table. It set the bar of high end…

        That being said it’s build quality is lacking a bit…but specs wise…use wise. This is the business.

      • evo is old

        Wrong… Screen has millions less colors than the worst droid lcd. Processor is not on par with new imaps and snap dragons or hummingbirds. Internal memory is wack. And battery life is not a day and a half of use (it even says that on the box lol)

  • Badchad

    It’ll be interesting to see how the extra $10 surcahrge affects these numbers, especially if it’s somewhat “hidden”.

  • Tmorep

    Let the Sprint and T-Mobile merger rumors start………..

    • Chut Pata

      I would like Sprint to takeover Metro PCS and offer the same plans. I love Metro PCS plans but their coverage sucks. Since they are CDMA, the only other company that would buy Metro PCS would be Verizon, and they would never ever offer any plan that is not a daylight robbery.

    • Anonymous

      Let’s not…Please?!

  • Joey

    It’s like being stuck 25 ft underwater and only able to swim 5 ft up. You’re still 20 ft. underwater and are still drowning.

    • Supercop

      They have better cash to debt ratio than att and vz. Don’t hate.

      • Scorp

        Do you work for Sprint? Is the CEO your dad? It’s only a carrier. Stop defending it like its your business or someone said something about you mom.

      • Chut Pata

        Yup. It is just another carrier, so stop hating it. No, my dad is not the CEO of Sprint. I have a Verizon Android and an AT&T iPhone.

    • Supercop

      They have better cash to debt ratio than att and vz. Don’t hate.

      • BoyRetard

        Let me give you a quick lesson in Finance 101. Companies that have large amounts of cash on hand are not necessarily healthy. In fact, cash is the worst place to put your profits. There are only 2 reasons to have tons of cash on hand. 1. You are about to make a large purchase or investment (like when Verizon purchased Alltel or prior to their LTE launch) or 2. They are begging to be bought out. Look at it like this: if Sprint has $500 million in cash on hand and their company’s entire quantity of stock can be bought out for $1 Billion, a purchaser can fork over the $1 Billion purchase price and immediately have $500 million in their bank account; making the actual purchase only $500 million. Sprint is either very stupid or ready to make a big move, we shall see.

      • Supercop

        That explains why apple,msft, and cisco maintain a large cash position. Finance 101 haha.

        And no. sprint has $6B in cash. Not $500m in your example.

      • Joel

        Supercop his 500m was an example and they cisco and apple hold large amounts of cash cause they are continually investing in new technology.. You just got a F- in finance 101

  • Anonymous

    Yeah, they were all EVOOOO activations.
    Meanwhile, they’ve completely stagnated on new devices with comparable design, specifications, and Super Powers!

    • Itsjustmee

      … and waste time, effort and credibility on the Kycera Brick that will appeal to a miniscule group of potential buyers

  • Nextelian_Survivor

    Sprint has been floating on that side of the titanic that still had the bow sticking out of the water a bit longer right before it sank. Their staff and die-hard supporters are on that side of the ship still in denial of what’s about to happen.

    Read my words: By years end Sprint will either fold or sell out/ merge with another provider. Losing this much money quarter after quarter is unsustainable.

    Can’t wait for the spin doctors to come and spin these results as good news.

    • Supercop

      Did you read their balance sheet before making that prediction?

    • Migs

      with 6 billion dollars Sprint has in cash on hand, im pretty sure they will be fine. so sorry to burst ur party but Sprint isnt going anywhere anytime soon if ever. this my friend is just the beginning of good things to come.

      • Publiuslocal

        cash on hand isnt creating RGU’s is it? did you see the number of PRE paid subscribers gained? until they boost post paid #’s you will continue to see this…….I love sprint….think they are a great company with huge potential….

        but between their inability to attract NEW post paid customers……their DEBT from clearwire debacle……price of devices……lack of new attractive devices (Blackberry Style?) thats the best ya got……and their flim flam wi max errr LTE decision……they need to get with the LTE boon….re acquire towers to reduce lease fees……attract the iphone/blackberry torch type devices…….

      • Publiuslocal

        oh and let us not forget they single handedly have more MVNO customers than the other 3 combined……these MVNO’s while fine for creating quick cash are doing NO good for sprint……boot virgin,cox and all the other MVNO’s off your network and focus on creating stable RGU’s

      • Supercop

        Mvno’s are more profitable than kindle subscribers.

        Having $6b cash earning interest (Sprint) is better than paying interest on $70b debt (Verizon).

    • Anonymous

      Hmmm, I’ve been reading those words for the last four years or so. Hasn’t come to fruition before, I sorta doubt that it will this time either.

  • Cer

    Sprint boardroom:

    “Hey guys, look, we’re finally gaining subscribers”

    “Sweet. Now let’s change all our policies that got us to this point so we can cash in quickly off the backs of those new subscribers. I’m sure more will come! ”

    “Let’s drink to that!”

    • http://twitter.com/N301DQ MRCUR

      Sprint is still cheaper than VZW/AT&T.

      • Cer

        It depends on your plan and your discounts. I get 19% off both Sprint
        and Verizon. With the Verizon plan I’d switch to (450 mins, 250 texts,
        standard data) Verizon is less than $1.50 more expensive per month.
        That’s not enough to keep me tied to Sprint.

    • serpentor

      But any changes they make won’t affect them. It only applies to new subscribers.

      Otherwise you they’ll get to cancel their contracts without penalty.

      • Cer

        Wrong. Changes to the premier program affect all customers, old and
        new, since the program was not part of the cellular contract. Sprint
        isn’t grandfathering. The $10 data fee doesn’t affect you until you
        get a new phone, but when you get a new phone it will almost certainly
        affect you, unless you get a phone without a data plan.

  • Anonymous

    Verizon is going to murder growth for other carriers without the iPhone, lets face it. Are iDEN customers leaving to other carriers or are they being converted to CDMA?

    • Supercop

      Funny. Sprint added more customers than Verizon in Q4. Explain the murder?

      • Anonymous

        iPhone. They still added more customers. Sprint is losing iDEN subscribers, mums the word on if they are converting to CDMA. Sprint is still not posting any profits. 4G network development is at a halt. Devices are lackluster. Prices for all smartphones just went up. etc..

      • Supercop

        Vz actually lost $ in Q4. Thatu is on top of increasing debt for the past 3 years close to $70b. Things are not going to look better with added subsidy of iphone and 4g buildout.

      • Anonymous

        Verizon’s debt (whatever it may be, I haven’t checked) is good debt. Sprint’s debt is bad debt.

  • Anonymous

    OMFG
    It’s Sandy S. Schwartz aka a pretend ‘Contract Lawyer in Manhattan’ with a horrid picture. Oh, wait, I’m turning to stoneeee……..

  • Anonymous

    I’m confused. How is it possible to net + subs and still loose money. Is the cost of building out the WiMax network that high. Admittedly I didn’t read the whole post…just the blurb above.

    • Supercop

      They allocated profit toward paying debt and raised cash position to over $6b. Would have been profittable for the past 3 quarters if they followed att & verizon’s accounting.

  • Anonymous

    The company can’t stay longer if the financial isn’t OK even they got massive headcount.

    • Supercop

      Go read Sprints balance sheet. You may be surprised. Everybody been predicting bankruptcy for the past 10 years. Yet they managed to stay alivr for over 100 years. Without gov bailout.

  • Anonymous

    For the last time, can people stop overreacting to the Kyocera announcement? Its Sprint, and if youve been around them longer than yesterday you would know that Sprint isnt afraid to think outside the box when they announce phone concepts. Believe it or not, they can afford to do that. No different than the Dual sided phone Sprint had a few years back. They just gave another carrier the opportunity.

    Their plans combined with coverage is the best out there…and what do you know, Verizon & At&t just now got copies of the EVO. By the time they are released, Sprint will have an EVO 2 ready to go and youll bandwagon Sprint again. MWC hasnt come yet, nor CTIA which is when Sprint announces a majority of their phones for the year. When Sprint has an EVO 2, Optimus 3D, Pre 3 & 7 Pro in their lineup by the summer. People will have the best options out there…its not about Quantity of smartphones (Verizon & At&t) but Quality.

    • Supercop

      Lets not forget Sprint spent $10b on wimax and managed to come out better in the balance sheet than verizon and att. Verizon is close to $70b in debt, att $44b. How else are they going to build out their 4g w/o borrowing more.

  • Fgh

    Actual, look at EBITDA, which is much more meaningful number. They are spending a large amount on capital expenditures which causes earnings to look back because of high depreciation. They are actually improving quite a bit. I value telecom companies for a living and they are actually much better off that the bottom line presents. I’d be a buyer of their shares. Note- I am not an analyst following their stock and do not own it now, but I am tempted.

    • bchside

      They lost me and future 4 lines: Could give a shit about capital expenditures and cash on hand. After 10 yrs of service, coverage was outstanding. No individuality for family plans is not ! Sprint has the highest taxes and regulator fee’s (all have gone up and up). Customer care with Sprint is the worst example of business practices I’ve ever been apart of compared to any business. We are all fools, EVO, Iphone, whatever smartphone we speak of, buy a flip phone put a note pad in your pocket. Save yourself reoccurring loss of monies spend for a plan, invest in an IRA Roth.

  • Dwin

    All those customers will be gone soon when they start realizing how bad the network has gotten nationwide with all the smartphone adds and people moving over from Nextel all with no network upgrades.

    • Dman2123

      Yeah the network is so horrible LMAO….Most people that travel for a living have Sprint. Big business has Sprint for all the 3rd party apps running on there phones which all the other carriers just realized they were missing out on. Oh and by the way to everyone talking about tower leases and network build out. They are getting ready to overhaul the whole network with trimode towers eliminating the iden network all together and most likely they will deploy LTE on the old Iden spectrum. Sprint is not going anywhere in terms of folding. As for the phone line up…..Sprint doesnt usually annouce ther big phone linup until CTIA which is in March. At that time all you suckers can eat it when they annouce the EVO 2 with the best specs on the market yet once again while VZW aand ATT try to play catch up with last years EVO.

      • Supercop

        All announced none released. As of today Feb. 10, there is no answer to the EVO that was released 8 months ago. The Droid Clunker X dont qualify. 90% of xda community have the EVO.

    • bonemachine

      I dont think there is enough Nextel subscribers left to add much capacity to the CDMA network even if they all switched tomorrow. Besides Sprint has been increasing their EV/DO capacity by adding additional DO carriers to high cap cells in the larger markets for almost a year now.

  • ABC

    Anyone see Hesse on Closing Bell? Good things to come…

  • serpentor

    Let’s put this in perspective. AT&T had only 400k new post paid subscribers AND they have the iPhone.

    In that context 58k isn’t that bad when I don’t think they really had a big launch for a phone last quarter.

  • Jonathan R.

    Wait, so 1,100,000 subscribers were added minus 58,000 post paid = 1,042,000 prepaid subscribers?!?! Bwahaahaa!! FAIL

  • Gsodata

    I worked in the wireless industry for many years, for the top 3 carriers. What Sprint is going to do with their network is pure genius. Simple chip-based cabinets that can run multiple frequencies & platforms with less energy. Increased coverage with fewer towers. Everyone else will have to copy this model sooner or later. Years ahead of Verizon and AT&T (who are going to run into major network issues even with LTE). Sprint is a major player and here to stay. They have the guts to innovate.

  • http://twitter.com/Syk0Matik420 Beefy McBigDick

    ok, so 13 straight quarters of financial losses as well as subscriber losses. Then, they finally post a quarter in which they GAINED subscribers yet somehow still posted LOSS in revenues? Something aint right at Sprint. I would start with checking how much money is being skimmed and put in the ceo’s bank account every month. Either that or Sprint is just a sinking ship of a money pit and should quit now. either way, bad news.

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