Sprint Corporation (NYSE: S) Monday reported results for the fiscal year 2019 third quarter, including stability in postpaid wireless service revenue and continued growth in postpaid net additions. The company also reported a net loss of $120 million, operating income of $66 million, and adjusted EBITDA of $2.5 billion.
“I continue to be impressed by the commitment of Sprint employees to deliver results during this period of uncertainty,” said Sprint CEO Michel Combes.
“As we await a decision in the state attorneys general lawsuit, I continue to believe the merger with T-Mobile is the best way to deliver the benefits of competition to American consumers.”
Craig Moffett of MoffettNathanson hoped this would be the last earnings release without a follow-up call, “please, please, please,” he added, for Sprint-in-limbo.
“We have no idea what Judge Marrero will decide in the State AG case,” Moffett said. “We’re still at 50/50, with the merits in the case at hand favoring the states but with full acknowledgement that the ‘merits in the case at hand’ aren’t the only issue – but we’ve never thought either side was likely to appeal, so one way or the other, we believe this will finally, and blissfully, be the end.”
Postpaid wireless service revenue of $4.2 billion remained stable sequentially and year-over-year as Sprint continued to focus on promoting its feature-rich Unlimited Plus and Unlimited Premium rate plans, selling additional data devices, and being more selective in its acquisition of postpaid phone customers. Postpaid net additions of 494,000 and average postpaid accounts of 11.3 million improved sequentially and year-over-year, while postpaid ARPU of $124.80 remained stable.
Total wireless service revenue of $5.2 billion was negatively impacted by the continued amortization of prepaid contract balances as a result of adopting the new revenue standard last year, according to the telecom. The year-ago period included Lifeline revenue related to federal and state government subsidies claimed as a result of an inadvertent coding error. Adjusting for these impacts, total wireless service revenue was stable year-over-year and sequentially.
The company continued its focus on cost optimization during the quarter by driving year-over-year gross reductions in cost of services and selling, general and administrative expenses, with most of the reductions coming from network optimization. These reductions have been offset by incremental costs associated with network coverage and capacity improvements, along with other customer experience initiatives.
Other highlights:
- Sprint made continued progress on executing its focused Next-Gen Network plan. Sprint has 2.5 GHz spectrum substantially deployed on its existing macro sites.
- The company has continued the rollout of Massive MIMO, a technology that improves network capacity, enhances LTE performance, and allows for simultaneous use of spectrum for LTE and 5G.
- The company has thousands of Massive MIMO sites on-air. Sprint has approximately 37,000 outdoor small cells deployed including both mini macros and strand mounts.
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