Sprint's losses shrink on cost cuts, subscriber gains

Reuters

Sprint Corp, the No. 4 U.S. wireless carrier, reported a smaller-than-expected quarterly loss, helped by cost-cutting measures and higher subscriber additions.

Shares of the company, which is majority owned by Japan's SoftBank Group Corp, rose 18.7 percent to $2.99 in premarket trading on Tuesday.

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Sprint also said it expects to return to a profit on an operational basis for the full-year ending March.

The company said on Monday it axed at least 2,500 jobs across six customer care centers as well as its Kansas headquarters as part of a turnaround plan that includes slashing costs by $2.5 billion.

Sprint added 501,000 net postpaid connections, compared with 30,000 a year earlier.

Customer sign-ups, which increased for the second straight quarter after two years of declines, were driven by aggressive promotions.

The company launched a plan in November under which customers who switched from Verizon Communications Inc, AT&T Inc and T-Mobile US Inc would pay only half of what they paid for their existing plans.

Sprint posted a net loss of $836 million, or 21 cents per share, in the third quarter ended Dec. 31, compared with a loss of $2.38 billion, or 60 cents per share, a year earlier.

Excluding items, the company lost 21 cents per share, beating the average analyst estimate of 25 cents per share.

Sprint's net operating revenue fell 9.7 percent to $8.11 billion, below the average analyst estimate of $8.23 billion.

For the full year, Sprint said it expects an operating income of $100 million-$300 million, compared with its previous forecast of a loss of $50 million-$250 million. (Reporting by Kshitiz Goliya in Bengaluru; Editing by Anil D'Silva and Saumyadeb Chakrabarty)