(Reuters) - Sprint Corp’s (S.N) 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.
The latest quarter included a $2.1 billion non-cash impairment charge.
AT&T and Verizon invested $18.2 billion and $10.4 billion, respectively, in the AWS-3 spectrum auction in the United States that closed last week to buy airwaves to upgrade their networks.
Some analysts have suggested that Sprint, which has a vast trove of spectrum and did not participate in the recent AWS-3 spectrum auction, could consider selling some of it to add cash to its balance sheet.
“What’s been a huge eye-opener to me is the amount of money the different companies paid ... in the latest AWS auction,” Claure said. “We have so much (spectrum), we’re looking at what is the value and what are people willing to pay us and we will make a decision.”
Shares of the company, which is 80 percent owned by Japan’s SoftBank Corp (9984.T), rose 6.3 percent to $4.87 on the New York Stock Exchange on Thursday.
Through Wednesday’s close of $4.58 per share, Sprint’s stock had dropped more than 40 percent in the past 12 months.
Reporting by Malathi Nayak in Bangalore and Abhirup Roy in Bengaluru; Editing by Savio D'Souza and Paul Simao