Click to Skip Ad
Closing in...

After $15.5 billion splurge on iPhone, Sprint may need $7 billion in new financing

Updated Dec 19th, 2018 7:33PM EST

If you buy through a BGR link, we may earn an affiliate commission, helping support our expert product labs.

In addition to the costs needed to upgrade its network to LTE by next year, Sprint said earlier this week that it is paying Apple $15.5 billion during the next four years for the iPhone. That huge cost means the carrier may need an additional $7 billion in financing to help boost liquidity, Reuters said on Thursday. Reportedly, Sprint is seeking $3 billion of the additional funds from vendor deals and an additional $4 billion in refinanced debt. “[The] iPhone has an expensive contract, but it is worth every penny,” Sprint CEO Dan Hesse said on a recent conference call in reference to the money it pays Apple on each iPhone phone. Sprint pays Apple a subsidy fee that is 40% larger than any other handset it sells, but the carrier also said the iPhone has been the fastest-selling handset it has ever launched. On Wednesday, Sprint said it was negotiating a new network sharing deal with Clearwire that would extend beyond 2012. Several analysts think Sprint may be trying to juggle too much at once, however. “They’re betting the house on two things at the same time,” Mizuho analyst Michael Nelson told Reuters. “If they pull it off, great. If they don’t, their financial performance would get materially worse, and they could have significant liquidity risks.”