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Aug. 8, 2007

Overall, Sprint Nextel did post slightly lower quarterly profit today, but still managed to beat analysts' expectations as it added new subscribers during the quarter.

In recent quarters, Sprint has struggled and posted net income of just $19 million, or about a penny a share.

This compares with $370 million, or a little over 10 cents a share for the corresponding 2006 quarter.

Overall revenue increased slightly to $10.16 billion from $10.01 billion.

Analysts on average had expected $10.19 billion. Sprint Nextel did say it added about 16,000 customers who pay monthly bills (called postpaid subscribers) in the quarter, compared with an average forecast of 28,000 among six analysts surveyed.

Average estimates ranged from a loss of 20,000 subscribers to a gain of 50,000.

Excluding one-time items and amortization, Sprint earned 25 cents per share, topping analysts' average forecast by 3 cents. Sprint had said it expected to start adding high-value postpaid customers in the second quarter after suffering a decrease in such customers in recent quarters, due to network problems and other related issues.

Before depreciation and amortization, Sprint Nextel forecast 2007 operating income of approximately $11 billion to $11.5 billion.

Customer cancellations were lower, to about 1.92 percent in the second quarter, from 2.3 percent in the first quarter of 2007.

Sprint, which competes directly with AT&T, Verizon and Qwest, forecast full-year revenue of $41 billion to $42 billion. According to Reuters Estimates, analysts' average forecast is $40.97 billion.

The company's stock has increased close to 16 percent since the beginning of the year, as investors bet its subscriber growth rate would somewhat get better.

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Source: CNN Money