(Updates share price, adds quote from CEO, churn and EBITDA
By Marina Lopes
WASHINGTON, July 30 Sprint Corp reported
higher-than-expected first-quarter revenue on Wednesday, as the
company expanded its high-speed coverage and came closer to
completing a network overhaul that has caused more frequent
dropped calls and subscriber losses.
Faced with growing competition from its rivals like
T-Mobile, Sprint has slashed prices and offered
customer guarantees in an attempt to offset those subscriber
"Its not as horrible as people feared. The company has done
better than the really pessimistic expectations, but it is still
not doing well," said Roger Entner, lead analyst at Recon
"It has to get better soon because they should be at the
tail end of their network overhaul. At the same time, T-Mobile
is showing dramatic growth," he said.
The company is currently testing new price plans, Sprint's
Chief Executive Dan Hesse said in a call with investors.
"When you look at doing a reprice, you want to make sure
your network is strong enough that you can attract new customers
to offset the price down of existing customers," Hesse told
Reuters in an interview.
Sprint will also launch highly customizable plans on its
Virgin Mobile brand sold exclusively at Walmart. The plans start
as low as $6.98 per month. Customers can then add special offers
that give unlimited access to applications like Facebook and
Sprint switched from reporting on a calendar year to a
fiscal year this quarter.
The company reported a growing customer defection rate,
known in the industry as churn, of 2.05 percent, higher than the
1.83 percent Sprint reported a year ago, but down from last
quarter's 2.11 percent.
The company reiterated its forecast of earnings before
interest, taxes, depreciation, and amortization (EBITDA) between
$6.7 billion and $6.9 billion for the calendar year 2014.
Excluding unusual items, Sprint earned 1 cent per share in
the quarter ended June 30, compared with Wall Street
expectations of a loss of 1 cent, according to Thomson Reuters
The company, 80 percent owned by Japan's Softbank Corp
, posted a profit of $23 million, the highest in over
Revenue fell to $8.8 billion from $8.9 billion a year
earlier, but beat the average analyst estimate of $8.7 billion
according to Thomson Reuters I/B/E/S.
The company lost 181,000 contract subscribers, fewer than
the average estimate of 293,000.
Sprint shares fell 1.75 percent to $7.86 on the New York
(Reporting by Marina Lopes; Editing by Bernadette Baum, Jeffrey
Benkoe and Chris Reese)