Sprint Q3 Earnings Drop 77 Percent
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Richard Baguley Published on November 01, 2007 Comment on this |
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1st Nov 07 – Sprint had a bad third quarter, with their just released quarterly results revealing that their earnings dropped an unprecedented 77 percent. This drop in earnings comes after Sprint CEO Gary Forsee left the company in October, and after a disappointing second quarter. Sprint said that in the third quarter, they earned 23 cents a share, down from 32 cents a share in the same quarter of 2006. While that is slightly better than the estimates of analysts (who were expecting 22 cents), it is a disappointing number, especially following a weak second quarter. Sprint also lost a lot of customers in this quarter; their figures for postpaid subscribers (those on monthly plans, not pre-paid plans) fell by 337,000. Their churn (the percentage of subscribers who disconnect or are cut off) also rose to 2.3 percent, with the blame falling on an increased number of what Sprint calls a “higher voluntary and involuntary deactivations”. The latter is when they terminate a customers contract, something that Sprint has been doing quite a lot this quarter.
However, there is some good news: Sprint's revenues for mobile data grew by 28 percent, indicating that an increasing number of subscribers are using their phones for more than just making phone calls.
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