Sprint's Q4: Huge bet on iPhone (just about) paid off

Sprint's Q4: Huge bet on iPhone (just about) paid off

Summary: The first quarter where Sprint had the long-awaited iPhone on sale brought a mixed bag of results: A rise in subscribers, but a massive net loss.

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Sprint announced its fourth-quarter results this morning, and what a show it has been. After its third-quarter results, Sprint was hinging its bets on the iPhone bringing in new customers. In short, it won the bet but arguably by the skin of its teeth.

Some quick facts:

Sprint now serves more than 55 million customers. Breaking this down, the third largest mobile network has 33 million contract customers and 14.8 million on pre-paid, as well as 7.2 million customers from wholesale.

Sprint sold 1.8 million iPhones in the quarter. It was predicted that Sprint would sell 1.9 million iPhones, but it fell short. Verizon sold 4.3 million Apple smartphones in the last quarter, and AT&T activated 7.6 million devices in comparison

In the fourth-quarter received 1.6 million total net subscribers --- the best quarterly result since 2005. The iPhone's debut on the network brought in 40 percent of new subscribers.

Joe Euteneur, Sprint's chief financial officer, had warned that the iPhone would be far more expensive than other smartphones, but still shows customer demand amidst reluctance for the iPhone.

But Sprint's net loss for the quarter totalled $1.3 billion --- wider than last year's $929 million loss --- and dwarfs the third-quarter's $301 million losses. While the greater loss was almost expected, the depth of it was not thought to be so steep.

The wider loss was due to the subsidies Sprint gives customers on the iPhone's it sells. It was not an unwise move for the company, still holding onto a podium position for the battle of the U.S. mobile marketshare, but it will have to scale this back to claw back its losses.

However, net operating revenue grew to $8.72 billion from $8.3 billion in its last fourth-quarter. It fell just above analysts' expectations, but not by much.

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Topics: Mobility, Hardware, iPhone, Smartphones, Telcos

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6 comments
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  • RE: Sprint's Q4: Huge bet on iPhone (just about) paid off

    I'm one of them. I left Verizon after over 20 years of being a customer (gong back to the days of cell phone bricks mounted in the trunk of the car) because Sprint gave me unlimited data and better coverage for my 3-lin family plan and did it for $50/mo less than Verizon. Verizon didn't care until AFTER I'd already left - THEN I got the calls asking why (And I told them that they ignored my calls before I left asking them to match the price).
    djlong
    • It's hard to beat the Sprint Family Plan

      @djlong We have four lines and if we decide to add our youngest on the next contract, we'll have five lines. Nobody can touch Sprint's prices. We share voice minutes and get unlimited data. Sprint's coverage seems to be getting better as well. Recent road trips to OK and FL gave us great coverage.
      markh@...
      • RE: Sprint's Q4: Huge bet on iPhone (just about) paid off

        @markh@...
        sprint coverage for calls is great, for data, not so much.
        tiderulz
      • RE: Sprint's Q4: Huge bet on iPhone (just about) paid off

        @tiderulz Data is very good in our home area with the WiMax 4G. Considering how little we travel, we can live with less than great data on trips. Coverage where you live is everything.
        markh@...
  • RE: Sprint's Q4: Huge bet on iPhone (just about) paid off

    Though I'm an Andriod user on Sprint, it is nice to have the iPhone as an option if I decided I wanted to move in that direction. Question now is whether T-Mobile will be able to secure an iPhone deal. This pretty much shows that to survive in the mobile arena you've got to offer the iPhone.
    dsf3g
    • RE: Sprint's Q4: Huge bet on iPhone (just about) paid off

      @dsf3g
      Yeah, because loosing money hand of fist is "surviving."
      x I'm tc