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Sprint (S) Fiscal Q3 Loss Widens, Revenues Top

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Sprint Corp. (S - Free Report) a leading telecom operator in the U.S. providing wireless and wireline services to individuals, business enterprises and government agencies.

Sprint is on track with its network modernization and integration efforts, which has fortified its position in the wireless industry. We also believe that efficient usage of capital, reduction of cell sites, elimination of dual networks, backhaul efficiencies, reduced churn, lower roaming charges and energy cost savings are some of its major positives.

We are also impressed with Sprint’s efforts to lure more customers through different winter promotional offers such as ‘Unlimited Freedom’ and ‘Sprint Open World’. However, attractive promotional plans and lucrative discounts to win customers from rival carriers such as AT&T Inc. and Verizon Communications have resulted in high cash burn and heavy losses for Sprint.

Also, while Sprint’s decision to skip the Federal Communications Commission’s 600 MHz low-band airwaves auction will save cash, it will limit its scope for network upgrades and expansion. Additionally, the company has a debt-laden balance sheet and negative operating cash flow. Moreover, it has been witnessing losses since 2007.

Zacks Rank:  Sprint currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

We have highlighted some of the key stats from this just-revealed announcement below:

Earnings: Sprint incurred loss in Q3 of fiscal 2016. However, net loss was wider than the Zacks Consensus Estimate. Our consensus estimate called for an adjusted net loss of 8 cents per share and the company reported adjusted net loss was 12 cents per share.

Revenue:  Sprint reported total revenue of $8,549 million surpassing the Zacks Consensus Estimate of $8,262 million.

Key States to Note: In the reported quarter, Sprint added 577,000 total connections, including postpaid net additions of 405,000, prepaid net losses of 501,000, and wholesale and affiliate net additions of 673,000. Total postpaid churn was 1.67 percent and postpaid phone churn was 1.57 percent in the quarter. Total net operating revenues came in at $8.5 billion, which marks an addition of $442 million year-over-year, or more than 5%.  Cost of service and selling, general and administrative expenses declined by nearly $500 million year-over-year, bringing the year-to-date cost reduction to more than $1.6 billion.

Sprint Corporation Price and EPS Surprise

 

Sprint Corporation Price and EPS Surprise | Sprint Corporation Quote

Check back later for our full write up on this Sprint earnings report later!

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