Sprint Profit is Its First Since 2007

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Sprint Corporation reported its first profit for a quarter in over six years with sales that topped estimates of analysts as the wireless provider kept more of its subscribers.

The carrier posted net income for its fiscal first quarter of more than $23 million. That followed 27 consecutive periods of only losses. Monthly subscribers dropped by 245,000 for the company based in Overland Park, Kansas.

However, the loss of subscribers was better than analysts had projected of 263,000. Revenue for the carrier was $879 billion, which also exceeded analyst estimates of $8.75 billion.

Sprint helped to limit losses of subscribers by offering its Framily plans that feature reduction in monthly payments as the group size increases.

Nevertheless, the ongoing erosion of customers puts continued pressure on the owner of the carrier, Softbank Corp based in Tokyo.

The CEO of Softbank, Masayoshi Son wants regulators in the U.S. to consider allowing T-Mobile and Sprint to combine and create a No. 3 wireless provider that is stronger and more competitive.

Dan Hesse the CEO at Sprint said he expects to be adding contract subscribers during the final three months of 2014.
Shares of Sprint were up 3% in early Wednesday trading to $8.25. The stock has dropped 26% during 2014 through the end of the day of trading on Tuesday.

Last quarter, the wireless carrier lost over 333,000 subscribers from its monthly plans. For the quarter than ended at the end of June, the 245,000 loss compares with the 1.4 million new subscribers at Verizon and the 1 million new ones at AT&T.

Sprint said 535,000 new tablet customers were added, helping its customer figure overall. That means over 646,000 of its customers were lost in the voice sector, according to one industry analyst.

The average bill for phone service for Sprint’s subscribers fell by 3.3% to $62.06, in comparison to an analyst estimate of $61.21.

The profit margin for the firm grew to 24%, but fell short of analysts’ estimates of 26%.

The forecast for the company was reiterated for its adjusted earnings of $6.9 billion for the year prior to interest, taxes, amortization and depreciation.

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