U.S. telco reports first full-year revenue growth in three years.
Sprint on Wednesday reported a smaller fiscal fourth-quarter net loss thanks to growth in equipment revenue; however, just like rival U.S. telcos AT&T and Verizon, the company also lost a considerable number of postpaid customers.
Sprint ended March with 59.70 million mobile customers, up from 58.81 million a year earlier. Net additions for the quarter were 187,000, as prepaid, and wholesale and affiliate customers grew by 180,000 and 125,000 respectively, offsetting a decline of 118,000 in Sprint’s postpaid base.
Competition is heating up in the U.S. mobile market, with operators trying to tempt prospective customers with new unlimited price plans.
Last month, Verizon revealed it lost 307,000 postpaid connections in the three months to 31 March, while AT&T’s postpaid base fell to 77.35 million from 77.78 million at the end of the prior quarter.
T-Mobile US, on the other hand, appears to be going from strength to strength; it added 914,000 branded postpaid customers during the same period.
The decline in Sprint’s postpaid base was reflected in its quarterly results, as service revenue fell 6.97% year-on-year to $6.12 billion (€5.61 billion). However, equipment revenue surged to $2.42 billion from $1.50 billion, resulting in overall revenue growth of 5.80% to $8.54 billion.
Operating income jumped to $470 million from $8 million a year ago, while net loss narrowed to $283 million from $554 million.
For the 12 months to 31 March, Sprint’s revenue came in at $33.35 billion, up from $32.18 billion in the previous year. It represents the company’s first growth in full-year revenue for three years.
Costs fell to $31.58 billion from $31.87 billion, and operating income surged to $1.76 billion from $310 million. Adjusted EBITDA came in at $9.93 billion, up from $8.15 billion, while net loss narrowed considerably to $1.21 billion from $2.0 billion.
"Sprint took a big step forward in the second year of our turnaround plan," said Sprint CEO Marcelo Claure. "Net operating revenues returned to growth and cost reductions accelerated, leading to the highest operating income in a decade."
For the year ahead, Sprint expects operating income of $2 billion-$2.5 billion and cash capex of between $3.5 billion and $4 billion. Adjusted EBITDA is expected to be in the range of $10.7 billion-$11.2 billion.