Leap Wireless plans cost cuts for second half of 2012
NEW YORK, Sept 19
NEW YORK, Sept 19 (Reuters) - Leap Wireless International Inc is seeking ways to cut its costs to improve its cash flow for the rest of 2012, the top executive for the wireless service provider said on Wednesday.
The company plans to reduce its cash burn for the second half of the year compared with the first half and aims to produce positive free cash flow in 2013, Doug Hutcheson, Leap's chief executive said during a webcast of an investor conference.
"You'll see us take a number of activities to drive lower cash flow consumption," Hutcheson said, but declined to discuss specific cost-cutting targets.
While Hutcheson would not give details, he alluded to potential moves, such as outsourcing functions that Leap might have otherwise carried out in-house and also looking to reduce the subsidies it pays for handsets.
Leap posted a net loss attributable to common stockholders of $41.6 million, or 54 cents per share, for the second quarter and its revenue of $786.8 million missed Wall Street estimates.
The company, which competes with bigger rivals such as Sprint Nextel Corp and Deutsche Telekom AG's T-Mobile USA for cost-conscious customers, had also lost customers in the quarter.