Sprint lost a total of 75,000 net subscribers in Q1 2010, however, the company recorded its best year-over-year improvement in post-paid gross subscriber additions and the highest prepaid gross subscriber additions in five years as it achieved the best total company net subscriber results since the third quarter of 2007. Net post-paid subscriber losses improved year-over-year as the company lost 670,000 fewer subscribers than in the first quarter of 2009.
Sprint company served 48.1 million customers at the end of the first quarter of 2010. This includes 33.4 million post-paid subscribers (26 million on CDMA, 6.8 million on iDEN, and 607,000 Power Source users who utilize both networks), 11 million prepaid subscribers (5.7 million on iDEN and 5.3 million on CDMA) and approximately 3.6 million wholesale and affiliate subscribers, all of whom utilize the CDMA network.
Financially, Sprint reported consolidated net operating revenues of approximately $8.1 billion and a net loss of $865 million, which includes a non-cash $365 million (12 cents per share) increase in valuation allowance on deferred tax assets.
“Sprint’s first quarter results, including increased net operating revenues and significant year-over-year net post-paid subscriber improvements show we continue to make progress in improving the business,” said Dan Hesse, Sprint Nextel CEO.
Some other highlights:
- Post-paid churn in the quarter was 2.15% compared to 2.25% in the year-ago period and 2.11% in the fourth quarter of 2009.
- Prepaid churn in the first quarter of 2010 was 5.74%, compared to 6.86% in the year-ago period and 5.56% in the fourth quarter of 2009.
- Retail wireless service revenues of $6.4 billion for the quarter increased by less than 1% compared to the first quarter of 2009 and increased approximately 3% compared to the fourth quarter of 2009. The year-over-year and sequential improvement is primarily due to an increased number of prepaid subscribers as a result of the acquisition of Virgin Mobile and success of the Boost Monthly Unlimited offering.
- Wireless post-paid ARPU of approximately $55 for the quarter declined year-over-year from $56, but remained flat sequentially.
- Wireless equipment subsidy in the first quarter was approximately $1 billion (equipment revenue of $567 million, less cost of products of $1.57 billion) as compared to approximately $840 million in the year-ago period and approximately $960 million in the fourth quarter of 2009.
- Wireless capital expenditures were $311 million in the first quarter of 2010, compared to $197 million spent in the first quarter of 2009 and $427 million in the fourth quarter of 2009.
- Wireline capital expenditures were $56 million in the first quarter of 2010, compared to $77 million in the first quarter of 2009 and $62 million in the fourth quarter of 2009. The company made significant capital investments in prior years to build out its IP network, and less capital was required in recent quarters to maintain high quality performance levels.
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