Sprint Corp. (S) Reports Q2 EBITDA of $1.39B, Offers Outlook

Sprint Corp. (NYSE: S) reported Q2 EPS of ($0.19). Revenue for the quarter came in at $8.5 billion versus the consensus estimate of $8.69 billion. Q2 EBITDA was $1.39 billion vs consensus of $1.66 billion.

Quarterly Financial Results

• Operating loss was $192 million compared to an operating loss of $398 million in the year-ago quarter primarily driven by lower depreciation and amortization as the year-ago period included accelerated depreciation related to CDMA assets.
• Consolidated Adjusted EBITDA* of nearly $1.4 billion grew 3 percent over the prior year period, driven by double-digit growth within the Wireless segment. Wireless Adjusted EBITDA* of $1.37 billion increased 14 percent from the prior year period, as cost reductions across the business offset lower service revenues driven primarily by continued postpaid phone customer losses. Lower cost of service expenses related to the completion of the 3G and voice network replacement, lower net subsidy costs from the introduction of installment billing plans, and lower customer care and selling costs all contributed to the year-over-year growth.
• Sprint platform net additions were 590,000, mostly driven by strong wholesale net additions.
• Postpaid tablet net additions were 261,000 in the quarter, while phone losses were 500,000 and other device losses were 33,000.
• Sprint had 55 million connections at the end of the quarter.

Updated Outlook

Given the success of the new offers, the company expects increased selling costs associated with significantly higher gross additions and upgrade volumes in the fiscal third quarter of 2014. In addition, the significant loss of postpaid phone customers over the last few quarters has pressured wireless service revenue, and this trend is expected to continue into the next quarter. Therefore, Consolidated Adjusted EBITDA* is expected to be $5.8 billion to $5.9 billion for calendar year 2014.
The company still expects to meet its 800 MHz and 2.5 GHz deployment targets for the year, and now expects capital expenditures to be under $6 billion for calendar year 2014.

For earnings history and earnings-related data on Sprint Corp. (S) click here.

You May Also Be Interested In

• Iridium Communications (IRDM) Reports In-Line Q1 EPS; offers outlook
• Badger Meter (BMI) Tops Q1 EPS by 17c ; Provides Outlook
• Google (GOOGL) Makes Structural Changes to AI Teams to Quicken Progress: CEO