* Rev $756 million vs Street view $778.8 million
* Net customer losses 337,000 vs analyst view for loss of 55,000
* Eyes device financing to boost growth in 2013
* Leap shares fall almost 7 percent (Adds Executive comment)
Feb 20 (Reuters) - Leap Wireless International Inc reported a 1.5 percent decline in quarterly revenue as it lost far more customers than Wall Street had feared, sending its shares down 7 percent.
The wireless service provider for budget-conscious customers who pay for calls in advance, said it lost 337,000 net customers in the fourth quarter. The average expectation on Wall Street was for losses of 55,000 customers, according to analysts.
Leap has been trying to boost its revenue by signing up higher-spending customers with the sale of smartphones such as the Apple Inc iPhone but many of them cannot afford to pay for those devices.
Chief Executive Doug Hutcheson told analysts on a conference call that he is not happy with the company's results and complained about softness in the prepaid sector as well as customer departures related to its phone prices.
"By far and away the biggest thing is the device pricing and the ability for customers to pay for the device" Hutcheson said.
While the first quarter is typically strong for Leap because customers use tax refunds to buy phones, the company warned that customer additions would be lower in the current quarter than the first quarter a year ago.
New Street analyst Jonathan Chaplin said the fourth quarter customer losses, which compared with customer growth in the year-ago quarter, had "deteriorated drastically" in the quarter.
The company - which competes with rivals such as MetroPCS Communications Inc and Sprint Nextel Corp and a host of other prepaid services - promised a reduction in customer defections for 2013 from initiatives such as device financing for its customers.
But some analysts said that the best investors could hope for is an eventual sale of Leap. Hudson Square analyst Todd Rethemeier questioned whether the company would be able to turn around on its own.
"In the last three quarters they've lost about 14 percent of their subscriber base," said Rethemeier. "Management seems unable to find a strategy to reverse that.
"The only reason the stock is trading as high as it is because people think there's potential for a buyout," Rethemeier added.
But Roe Equity Research analyst Kevin Roe noted that potential Leap suitors Sprint and MetroPCS may not be able to make a bid for the company for some time.
Sprint is currently seeking to buy Clearwire Corp and to sell 70 percent of its own shares to SoftBank Corp and MetroPCS is looking to merge with T-Mobile USA, a unit of Deutsche Telekom.
"What Leap has to do is conserve cash to survive until the next round of consolidation," Roe said.
Leap said its fourth-quarter net loss narrowed to $74.3 million, or 96 cents per share, from a loss of $84.4 million or $1.10 per share in the year-earlier quarter.
Revenue fell to $756 million from $767.4 million and was below Wall Street expectations for revenue of $778.8 million, according to Thomson Reuters I/B/E/S.
Leap shares were down 44 cents or more than 7 percent at $5.68 in late morning trade on Nasdaq.
(Reporting By Sinead Carew; Editing by Gerald E. McCormick, Nick Zieminski and Andrew Hay)