Capping off a turbulent and eventful third quarter, Sprint Nextel (S) disclosed on Wednesday a narrower quarterly loss than Wall Street had feared thanks to 1.3 million total net new wireless subscriber additions.

However, the Overland Park, Kan.-based wireless provider continues to detail the heavy price of carrying Apple’s (AAPL) blockbuster iPhone device. Sprint now sees 2011 free cash flow ranging between a loss of $200 million and a gain of $100 million, compared with earlier forecasts for positive free cash flow.

Sprint, the No. 3 U.S. wireless carrier behind rivals AT&T (T) and Verizon (VZ), said it lost $301 million, or 10 cents a share, last quarter. Analysts had been forecasting a loss of 22 cents a share. A year earlier it posted a deeper loss of $911 million, or 30 cents a share.

Revenue inched up 2.2% to $8.33 billion, narrowly missing the Street’s view of $8.38 billion. Gross margins grew to positive 2.5% from negative 2.6%.

In recent weeks Sprint, has shaken up the wireless industry by inking a deal to begin selling Apple’s (AAPL) blockbuster iPhone device and unveiling plans to launch an expensive network-upgrade project.

Sprint has come under pressure from analysts, shareholders and credit ratings companies due to the heavy cost of supplying the iPhone.

Shareholders appeared concerned about the new cash-flow forecast. Sprint’s stock declined 5.19% to $2.57 Wednesday morning, adding to its 2011 loss of more than 36%. The company’s shares have plunged about 50% over the past 13 weeks alone.

Sprint said its 1.3 million total net new wireless subscriber additions last quarter was its best performance in five years. However, the company also disclosed a loss of 44,000 postpaid customers last quarter, a higher figure than some analysts had estimated.

Meanwhile, shares of Clearwire (CLWR) surged more than 22% as Sprint told analysts the two companies are in talks to extend a network leasing deal beyond 2012. 

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