Sprint's revenue beats estimates as price cuts draw subscribers
By Malathi Nayak and Abhirup Roy
(Reuters) - Sprint Corp's (S.N: Quote) quarterly revenue fell less than expected as the U.S. mobile provider attracted more subscribers by cutting prices and offering promotions, driving its shares up more than 6 percent on Thursday.
With its turnaround plan underway, Sprint managed to add 892,000 total wireless subscribers in the three months ended Dec. 31, well above Wall Street analysts' estimate of 790,000.
Wireless carriers have been going after each others' subscribers with discounts and attractive plans as they try to increase revenue in a nearly saturated market. With intense competition, retaining and adding users has been a challenge for Sprint and its larger rivals, AT&T and Verizon.
Postpaid churn, or the rate of customer defections, rose to 2.3 percent from a year ago.
"We only lost 200,000 (postpaid users) in one quarter. We were losing 200,000 customers a month," Chief Executive Marcelo Claure said in an interview with Reuters. "In this coming quarter ... we're potentially expecting one of the biggest drops in churn we have experienced in many years."
Since taking on the top post at Sprint six months ago, Claure has been focusing on improving subscriber metrics through offers such as cutting bills in half to switch from other carriers, doubling its data capacity and improving network quality. The company has also been reducing costs, trimming staff and revamping its management.
The company's net operating revenue fell 1.8 percent to $8.97 billion, but beat analysts' average estimate of $8.68 billion, according to Thomson Reuters I/B/E/S.
Sprint's net loss more than doubled to $2.38 billion, or 60 cents per share, from $1.04 billion, or 26 cents per share, a year earlier. Continued...