* SoftBank CEO: foundations nearly laid for aggressive pricing
* Q1 operating profit 337 bln yen vs consensus of 302 bln yen (Recasts with SoftBank CEO comments on new Sprint head)
By Teppei Kasai and Yoshiyasu Shida
TOKYO, Aug 8 (Reuters) - SoftBank Corp’s billionaire CEO said he chose a “streetfighter” to turn around U.S. carrier Sprint Corp, which faces an uphill battle for growth after abandoning plans to acquire rival T-Mobile US Inc .
SoftBank CEO Masayoshi Son also told an earnings briefing on Friday that Sprint had beefed up its network to the point where it could start cutting prices and aggressively woo back subscribers - underscoring analysts’ predictions that Sprint may embark on a price war to regain market share.
“Price competition will likely heat up,” he said.
Sprint, the No. 3 U.S. mobile carrier, has been losing subscribers as it carries out a much-needed network upgrade. After dropping its bid to acquire T-Mobile US due to regulatory issues, it must now do battle on its own with dominant players AT&T Inc and Verizon Communications Inc, as well as the nimbler and fast-growing T-Mobile.
Son said that Sprint’s new CEO, Bolivian-born Marcelo Claure, founder of handset reseller Brightstar Corp which was acquired by Softbank in January, had the guts and the experience in building up a company from nothing to take on the carrier’s challenges.
“Marcelo is a street fighter,” he said. “You look at his face and that’s the sort of look he’s got. He’s got the look of an outlaw ... I‘m confident that with him in charge, Sprint will be a very interesting company.”
SoftBank, going into its first full financial year with Sprint, Brightstar, and game companies GungHo Online Entertainment Inc and Supercell Oy consolidated on its books, posted a 16 percent drop in first-quarter operating profit on Friday. However, the decline was not as severe as analysts had expected and reflected a large one-off windfall in the year-ago quarter related to its purchase of Gungho.
SoftBank kept its operating profit target for the full year to March 2015 steady at 1 trillion yen ($9.8 billion), little changed from last year’s result of 1.08 trillion yen.
Analysts have said a price war could be a particularly heavy burden for Sprint, which still faces billions of dollars in further spending to build up its network.
In an indication of the challenges ahead, T-Mobile’s Chief Executive John Legere taunted its one-time suitor with a tweet on Thursday that his company would overtake Sprint as the No. 3 carrier in U.S. mobile subscriber numbers by the end of the year.
The declaration came a day after T-Mobile said it surpassed Sprint as the No. 1 wireless provider for prepaid customers, with 15.64 million users, compared with Sprint’s 15.19 million.
But Son said on Friday that Sprint was ready to go on the offensive.
“Until now, Sprint didn’t have the network to participate much in tough price competition and marketing battles, but now it’s ready to move aggressively.” (1 US dollar = 101.7600 Japanese yen) (Editing by Edmund Klamann/Edwina Gibbs/Susan Fenton)