Sprint also provided important updates on the iPhone, its financing needs and planned network upgrades, undoing some of the damage caused by an investor day presentation three weeks ago that had investors fuming and sent its stock plunging.
Its shares still edged lower on Wednesday as investors continued to focus on finances that look precarious for the next two years.
Sprint’s net loss was $301 million, or 10 cents a share, for the third quarter. That is down from $911 million, or 30 cents a share, a year ago. It was the best performance by Sprint since it reported a profit of $64 million in the third quarter of 2007.
Revenue rose 2.2 percent to $8.3 billion.
Sprint, the country’s third-largest wireless carrier behind ATT and Verizon Wireless, said it added a net 1.3 million subscribers in the July-to-September period, the best result since 2006. Sprint continued to lose subscribers from its lucrative contract-based plans, but at a relatively low rate: 44,000 in the quarter. Sprint’s total customer count, 53.4 million, is now back at where it was in 2007, before the exodus of Nextel customers turned into a torrent.
The company, based in Overland Park, Kan., has made steady gains in the last year and a half. Unfortunately for the company, most of the new customers are low-paying ones. They buy service from Sprint’s low-cost Virgin Mobile, Boost Mobile or Assurance Wireless brands, or from non-Sprint brands that use the company’s network.
The latest subscriber results do not include the effect of the iPhone, which Sprint started selling Oct. 14. The phone is expected to further improve the company’s ability to keep customers, at a high price. Apple charges about $600 for a phone that Sprint sells for $200.
Sprint’s chief financial officer, Joseph J. Euteneuer, said each iPhone would cost the company about $200 more than another smartphone. All the same, the company expects its four-year purchasing agreement with Apple to add $7 billion to $8 billion to its own bottom line.
The problem for Sprint is that the cost of selling the iPhone comes upfront, while benefits like higher service fees and lower service costs accrue over time. Sprint does not expect the iPhone to be a moneymaker until 2014.
The added cost of the iPhone comes as Sprint is also starting to revamp its network for higher speeds. That adds up to financing needs of $5 billion to $7 billion in the next few years, Mr. Euteneuer said.
Shares of Sprint fell 19 cents, or 7 percent, to $2.51.
Article source: http://feeds.nytimes.com/click.phdo?i=1ff1e6f83cb31fb12cd81f939da49b60
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