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Earnings Roundup / Sprint Nextel

Shares rise on glimmer of hope

February 20, 2009|Times Wire Reports

Sprint Nextel Corp., the nation's third-largest wireless carrier, said it continued to lose customers and money in the fourth quarter and wrote down the remaining value of its 2005 purchase of Nextel Communications Inc.

Even so, Sprint Nextel's condition has been so poor that investors were able to seize on news that wasn't as bad as usual. Sprint's adjusted loss beat Wall Street expectations, and the company predicted fewer customer losses in the coming year. That sent shares soaring 54 cents, or 20%, to $3.25.

The Overland Park, Kan., company said it lost $1.6 billion, or 57 cents a share, during the three months ended Dec. 31. By comparison, it lost $29.3 billion, or $10.31, a year earlier. That figure included a $29-billion write-down of the value of its purchase of Nextel.

Sprint said it wrote down the remaining $1 billion in Nextel's value during the fourth quarter.

Not including the write-down and other one-time charges, the company said it would have lost a penny a share, better than the 3-cents-a-share loss expected, on average, by analysts surveyed by Thomson Reuters.

Revenue fell 14% to $8.4 billion, missing analysts' forecast of $8.55 billion.

Sprint finished the year with 49.3 million subscribers, an 8.4% decline from 2007.

For the year, Sprint said it expected to lose fewer subscribers than the 4.6 million who fled in 2008.

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