(By Salman - iStockAnalyst Writer)Sprint Nextel (NYSE:
S), the third-largest US wireless carrier, is scheduled to release its third quarter earnings before the market open on Thursday, October 29, 2009. Analysts, on average, currently expect the company to report a net loss of 15 cents a share on revenue of $8.09 billion. In the year ago quarter, the company reported a net loss of 11 cents per share on revenue of $8.81 billion. In the past four quarters, the company has twice missed Wall Street forecasts.
The Overland Park, Kansas-based company has been consistently money and customers amid intense competition. Late in July, the company reported that its second quarter net loss widened to $384 million or 13 cents per share, from $344 million, or 12 cents per share, in the prior-year quarter. Net operating revenues for the quarter slumped 10% to $8.14 billion from $9.06 billion in the same period last year and down 1% from the sequential first quarter. Consensus expectations were for a loss of 2 cents a share on revenue of $8.12 billion for the quarter.
On a segmental basis, Sprint Nextel's wireless net operating revenues for the quarter declined 9% to $7.00 billion from $7.74 billion in the previous-year quarter. Of the total net operating revenues, wireless service revenues for the quarter declined 9% year-over-year to $6.4 billion. Operating loss for the segment widened to $314 million from $262 million in the same period last year. Wireless post-paid average monthly revenue per user, or ARPU, remained stable at $56, primarily due to growth in fixed-rate bundled plans such as Simply Everything, offset by declines in usage and roaming. Prepaid ARPU for the quarter was approximately $34, compared with $30 in the year-ago period. The company has continued to lose valuable postpaid customers to rivals. Post-paid churn in the quarter climbed 2.05% in the second quarter compared to 1.98% in the year-ago period, but down from 2.25% in the sequential first quarter. Postpaid churn is the measure of these monthly customers dropping service. The company has one of the worst churn rates in industry.
Sprint-Nextel is losing subscribers at a rapid pace. Even the launch of the highly anticipated Palm Inc. Pre couldn't prevent Sprint Nextel Corp.'s most lucrative customers from defecting to rivals in the second quarter. The wireless operator started selling the much-awaited Palm Pre on June 6 and has exclusive rights to the 'Pre' through at least the end of the year. Though Palm Pre has received favorable reviews, it has failed to match iPhone's success. The company served 48.8 million customers at the end of the second quarter, down 0.61% from 49.1 million at the end of the preceding first quarter.
