Sprint Nextel posts profit drop, talks EV-DO Rev A

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SprintSprint Nextel didn’t exactly rally the troops with their recent Q2 sales report. The company reported a second-quarter net income of 370 million USD, or 12 cents a share, down from 600 million USD, or 40 cents a share, earned in the same period during 2005. Earnings from continuing operations also fell to 10 cents a share for the latest quarter from 22 cents a year ago.

Sprint Nextel has made a modest revision to their 2006 forecast for consolidated revenue, which the telecom carrier now pegs at 41 billion to 41.5 billion USD, as opposed to the 41 billion USD or more previously forecasted. The company also said it will begin upgrading its network to deliver higher-speed mobile broadband services based on EV-DO Revision A technology during the fourth quarter.

  • thought

    The bottom line: the reason for Sprint’s poor results is their relatively poor network and customer service.

    When Sprint puts out a good product, customers will return. Until then, they’ll have to struggle to survive, and try to feed off of lower revenue customers. That’s one reason why most people know that if you are credit challenged, you stand a better chance of getting approved by Sprint.

    Someone I know at Verizon told me that with local number portability, the ratio of customers gained to customers lost relative to Sprint/Nextel is about 10 to 1.

  • thought

    The bottom line: the reason for Sprint’s poor results is their relatively poor network and customer service.

    When Sprint puts out a good product, customers will return. Until then, they’ll have to struggle to survive, and try to feed off of lower revenue customers. That’s one reason why most people know that if you are credit challenged, you stand a better chance of getting approved by Sprint.

    Someone I know at Verizon told me that with local number portability, the ratio of customers gained to customers lost relative to Sprint/Nextel is about 10 to 1.

  • thought

    Let’s put it in even more stark terms:
    Sprint added only 210,000 postpaid customers this past quarter (and 498,000 prepaid, which are far lower profit).

    Verizon added 1.8 million, and Cingular added 1.5 million.

    So, even though Sprint is generally perceived as having lower prices for service, and it’s easier to be approved for Sprint service, it’s results are anemic compared to Verizon and Cingular. In fact, I’d say those results are pathetic.

    I mean, if you are the cheapest, and you still lose out by that wide of a margin, you must be really bad. It would be like WalMart getting beaten by Nordstroms on sales volume.

    It’s interesting that the company executives and analysts have admitted that Sprint has a ways to go to turn things around.

  • thought

    Let’s put it in even more stark terms:
    Sprint added only 210,000 postpaid customers this past quarter (and 498,000 prepaid, which are far lower profit).

    Verizon added 1.8 million, and Cingular added 1.5 million.

    So, even though Sprint is generally perceived as having lower prices for service, and it’s easier to be approved for Sprint service, it’s results are anemic compared to Verizon and Cingular. In fact, I’d say those results are pathetic.

    I mean, if you are the cheapest, and you still lose out by that wide of a margin, you must be really bad. It would be like WalMart getting beaten by Nordstroms on sales volume.

    It’s interesting that the company executives and analysts have admitted that Sprint has a ways to go to turn things around.