UPDATE 2-NII Holdings Q3 beats market, shares hit year-high

* Q3 EPS $0.69 vs est $0.55

* Q3 rev $1.14 bln vs est $1.12 bln

* Reiterates 2009 outlook for subscriber addition

* Shares rise 8 percent to touch year-high (Recasts; Adds analyst comments, share movement)

By S. John Tilak and Mansi Dutta

BANGALORE, Oct 22 (Reuters) - Latin American wireless carrier NII Holdings Inc (NIHD.O) posted a quarterly profit that topped market estimates, helped by foreign exchange gains and growth in subscribers, sending its shares up 8 percent to a new 52-week high.

In the third quarter, the company -- which targets business customers in Mexico, Brazil, Argentina, Peru and Chile under the Nextel brand -- added 329,000 net subscribers to its network.

Average revenue per user rose $2 to $46 sequentially, but fell from year-ago levels. NII has also reined in customer dropouts. So churn rate - a measure of customer attrition -- fell to 1.93 percent, sequentially.

"They were very strong results across the board," Soleil/Nelson Alpha Research analyst Michael Nelson said. "They exceeded our estimates on virtually every operating and financial metric."

For the third quarter, the company's net income rose to $117 million, or 69 cents per share, from $84.4 million, or 50 cents per share, a year ago.

Net income included $45 million of foreign currency transaction gains, primarily related to the strengthening Brazilian real.

Revenue fell 3 percent to $1.14 billion.

Analysts expected the company to earn 55 cents a share, excluding items, on revenue of $1.12 billion, according to Thomson Reuters I/B/E/S.

The results represented an improvement in Mexico and continued strength in Brazil.

"Our Brazilian market delivered record levels of net subscriber additions and segment earnings during the period," Chief Executive Steve Dussek said in a statement.

The company added 185,000 net subscribers in Brazil in the quarter.

"Brazil was really the bright spot for the company," Nelson said. "They're achieving the desired results of accelerating growth and profitability."

NII maintained its 2009 outlook for net subscriber additions of 1.1 million to 1.2 million.

It expects revenue of $4.1 billion to $4.3 billion for the year, the top end of which was in line with analysts' estimates

Shares of the company -- which competes with Mexico's America Movil (AMXL.MX) (AMX.N) and Spain's Telefonica SA (TEF.MC) -- were up 1 percent at $32.72 in midday trade Thursday on Nasdaq. They rose to a new 52-week high of $35.01 earlier in the day.

For alerts, double click [ID:nWNAB2499] (Editing by Anil D'Silva and Unnikrishnan Nair)