Sprint Nextel reported revenues of $8.7 billion for Q4 2011, 5 percent higher than in the fourth quarter of 2010 and the third quarter of 2011. The quarterly year-over-year and sequential improvements were primarily due to higher wireless service and equipment revenue offset by a reduction in wireline revenue.
Sprint reported total net subscriber additions of 1.6 million during the fourth quarter of 2011 – the best quarterly result in six years – bringing total ending subscribers to the highest level in the company’s history.
“Our strong fourth quarter performance illustrates the power of matching iconic devices like the iPhone with our simple, unlimited plans and industry-leading customer experience,�? said Dan Hesse, Sprint CEO. “During the past year, Sprint added more than 5 million net new customers and grew wireless service revenue by more than 5 percent, including 17 percent for the Sprint platform. This momentum gives us confidence as we execute our Network Vision upgrade and 4G LTE roll-out.”
Some highlights for the quarter:
Sprint’s Network Vision initiative remains on schedule and on budget.
Field integration testing was completed in Q4 and the first multi-mode base station was launched.
Sprint expects to bring approximately 12,000 Network Vision sites on air by the end of 2012 and to complete the majority of its Network Vision roll-out in 2013.
Sprint expects to begin launching 4G LTE by mid-year 2012. In addition to Houston, Dallas, San Antonio and Atlanta, Kansas City and Baltimore will be among the initial six major cities to launch.
Wireless service revenues for the fourth quarter increased more than 7 percent year-over-year, driven by Sprint platform postpaid ARPU growth of $3.69 – the largest year-over-year increase on record across the U.S. wireless industry.
Strong revenue growth and cost management partially offset the impact of increased equipment net subsidies and sales expense associated with the successful launch of the iPhone.
Forty percent of Sprint’s 1.8 million iPhone sales in the fourth quarter were to new customers. Based on internal estimates, including incremental costs associated with iPhone sales, the combined impact of iPhone and Network Vision costs reduced fourth quarter Adjusted OIBDA margin, which was 10.8 percent, by approximately 8.8 percentage points.
Total postpaid net additions of 161,000 for the fourth quarter represent the tenth consecutive quarter of year-over-year improvement and were driven by continued strength of the Sprint platform, which had net postpaid additions of 539,000. This is the seventh consecutive quarter of net postpaid subscriber growth on the Sprint platform.
For Q4, Sprint posted adjusted OIBDA of $842 million for the fourth quarter and nearly $5.1 billion for the full year 2011. There was a net loss of $1.3 billion and a diluted loss of $.43 per share for the quarter, which includes pre-tax, non-cash charges of $241 million, or $.08 per share, consisting of asset and impairment charges of $78 million on property, plant and equipment, $135 million on Sprint’s investment in Clearwire and $28 million in severance costs.
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