Sprint also said it lost 101,000 contract subscribers in the period. The company was likely hit by the double whammy of the
Apple iPhone being available at both AT&T and Verizon Wireless. Speed freaks who would have gone with Sprint’s 4G service were likely drawn to Verizon’s faster 4G network.
The Overland Park, Kansas, wireless provider posted a loss of $847 million, or 28 cents a share, compared with a year-earlier loss of $760 million, or 25 cents a share. The results include equity losses of $588 million related to unconsolidated investments and a charge of $52 million related to taxes incurred in Michigan from a new state law.
Revenue rose 4 percent to $8.3 billion.
Wall Street, on average, had forecast a loss of 12 cents a share and revenue of $8.3 billion, according to a survey taken by Thomson Reuters.
Sprint also reported adding 1.1 million net new customers, with much of that growth coming from its prepaid and wholesale arm. The Sprint contract side fared decently, adding 226,000 net new customers. As with most quarters, the customer losses came from the Nextel side, having lost 327,000 net customers in the period. The company also lost 49,000 Nextel PowerSource customers, which own CDMA phones that can use Nextel’s iDEN network.
The company’s turnover rate for contract customers fell to 1.75 percent in the period, compared with 1.81 percent in the first quarter.
Sprint’s recent resurgence has relied on the strength of its 4G service, which is powered by Clearwire and a technology called WiMax. But with Verizon Wireless rapidly expanding its own faster 4G LTE network, Sprint has lost out on one of its biggest advantages.
The company, meanwhile, got competitive with pricing, offering a discount in May to lure in T-Mobile customers who may worry about the carrier getting taken over by AT&T. T-Mobile countered with its own offer to new users, and last week cut the price of its smartphone data plans.
Sprint reiterated its forecast for the full year, saying it expects improved total net wireless customer additions compared with 2010. It also expects capital expenditures for the year to be roughly $3 billion, and plans to generate positive free cash flow in the second through fourth quarters of the year.