Sprint loss widens in Q1, but subscriber defections slow

Sprint posted a wider first quarter loss but lost only 75,000 net customers, its smallest drop in close to three years. Sprint reported losses of $865 million, or 29 cents a share, compared with a year-ago loss of $594 million, or 21 cents a share--results include a $365 million non-cash charge related to deferred tax assets. Revenue dropped 1.5 percent to $8.09 billion, off analyst forecasts of $8.05 billion. Sprint lost 578,000 contract customers in Q1 and now serves 48.1 million subscribers in all, including 33.4 million postpaid users, about 9 percent of whom upgraded their handsets during the quarter. Sprint said it expects both postpaid and total subscriber losses will improve in 2010 compared to the previous year.

Sprint's retail wireless service revenues edged up $6.4 billion in Q1, an increase of less than 1 percent compared to year-ago totals and about 3 percent higher than the previous quarter. The operator credited both the year-over-year and sequential improvement to its Virgin Mobile USA acquisition as well as the success of its Boost Monthly Unlimited offering. Wireless postpaid ARPU declined from $56 in Q1 2009 to $55 in the current quarter, but remained flat sequentially--Sprint blamed the year-over-year dropoff on lower overage revenues due to the popularity of fixed-rate bundle plans, offset by reductions in customer credits resulting from an improved subscriber experience. Sprint did not divulge specific mobile data revenues and usage metrics for the quarter.

During Sprint's quarterly conference call Wednesday morning, CEO Dan Hesse acknowledged the gap between the company and rivals AT&T and Verizon Wireless: "AT&T and Verizon Wireless have many wireless numbers I wish I could report," he said. "They are still outperforming us." Hesse added that he is looking into tiered pricing for data plans, but has not yet arrived at a decision.

For more on Sprint's Q1 results:
- read this release
- for more earnings news click here

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