Business Anywhere Blog

Mobilizing the Business and Business of Mobile

How long will Sprint survive?

with 2 comments

Sprint today reported its Q3 numbers and they were horrendous. It lost 1.3 customers during the quarter which reduced its revenue from $10.04 billion a year ago to $8.81 billion this quarter. This resulted in a quarterly loss of $342 million or 11 cents a share.

Sprint has been losing customers, almost a million every quarter for the last 3 quarters. At this rate, it is going to run out of money soon. Then the question arises as to what happens to it. It has tried selling its iDEN (legacy) network which has gone no where due to lack of buyer interest. Its investments in WiMAX has a while to go before they can pay off.

Sprint did take steps to reduce bankruptcy concerns for now by paying down some of its credit facility and increasing interest that it will pay on its new debt. However, that just buys its some breathing space for now. Falling ARPU down to $56 and shrinking customer base does not bode well for Sprint. With its burn rate of $7.8 billion a quarter and $4.1 billion in cash balance at the end of the quarter, it will end up using all of its $1 billion free cash flow in coming months. I think it is a matter of time and another shoe to fall before Sprint becomes an acquisition target or fails.

[Via New York Times]

Advertisements

Written by dvdand

November 7, 2008 at 1:47 pm

Posted in Financials, Sprint

Tagged with ,

2 Responses

Subscribe to comments with RSS.

  1. My fellow on Orkut shared this link and I’m not dissapointed that I came to your blog.

    Heartburn Home Remedy

    April 15, 2009 at 3:38 am

  2. I appreciate your info! Thanks!

    Fast Credit Repair

    November 6, 2009 at 8:07 am


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: