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U.S. telco posts strong customer additions and narrows net loss, but revenue declines

Sprint on Wednesday posted a solid set of fiscal second quarter financials, including strong mobile customer growth, but made no mention of plans to merge with rival T-Mobile US.

The U.S. operator announced earlier this week that it would publish its numbers without hosting its usual conference call, mirroring a move made by T-Mobile US on Monday.

The decision raised speculation that a deal announcement could be imminent. The newswires earlier this month predicted the telcos would share merger plans alongside one of their results announcements, but the latest report from Reuters on Wednesday quoted anonymous sources as saying the deal will be finalised in the next three weeks.

The news outlet explained that both companies have formed special committees formed of independent board directors to decide whether the deal should be signed once the details have been finalised. The purpose of such a committee is to protect the firms from legal challenges from minority shareholders, it said.

In the meantime, Sprint is continuing to add customers.

The telco recorded 279,000 postpaid phone customer net additions in the three months to the end of September, and 95,000 prepaid net adds, giving it its highest retail phone net additions in more than two years.

"Sprint was able to deliver net additions in both its postpaid phone and prepaid business for the third consecutive quarter," said Sprint CEO Marcelo Claure, in a statement.

"I’m even more proud that the team was able to deliver this customer growth while continuing to attack the cost structure, improve the network, and maintain positive adjusted free cash flow," he said.

Sprint posted net cash provided by operating activities of $2 billion, an improvement of $251 million on the year-ago quarter, bringing the year-to-date total to $3.2 billion, up by $1 billion compared to a year ago. Adjusted free cash flow came in at $420 million, bringing the year-to-date total to more than $650 million, it said, adding that it expects adjusted free cash flow for the full year to be around breakeven.

The telco glossed over its revenue figure, which slid by 7% year-on-year to $5.97 billion.

However, it narrowed its net loss to $48 million from $142 million in Q2 2016.
 

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