Analysts react with enthusiasm at loss, which less than half the average expected size

Another, quarter has passed and more good news was in store for Sprint Corp. (S), America's third largest carrier.  Sprint ended the quarter with 54 million customers, but its most impressive statistics were its financials.
For the quarter Sprint saw its best operating income ($420M USD) in seven years, on an earnings before interest, tax, depreciation, and amortization (EBITDA) of $1.84B USD (up from Q1 2013 by 22 percent, marking the third straight quarter of growth).  
It trimmed its net loss to $151M USD -- an impressive showing that was roughly half the loss analysts were expecting, according to ValueWalk.  Total revenue -- $8.88B USD -- was also a small but positive surprise versus the $8.77B USD expected by the analyst crowd.  Shares jumped in after-hours trading.
Sprint is finally is seeing the light at the end of the tunnel for its expensive LTE rollout, with 3G tearout and replacement scheduled to begin later this year after the LTE network extends its reach from 225 million Americans (currently) to 250 million Americans (by "mid-year").
But Sprint isn't resting; it's pushing on with its new Project Spark advanced LTE effort.  While its coverage still trails U.S. market leader Verizon Wireless (a wholly owned subsidiary of Verizon Communications Inc. (VZ)), Sprint is hoping that the spunkier LTE network -- featuring tri-band 800MHz, 1.9GHz and 2.5GHz spectrum combined to give voice-over-LTE (VoLTE) and 50-60 Mbits/s downloads -- will allow it to actually seize the lead in select markets.  The VoLTE bit will turn on officially in July; for now Project Spark is actively bringing faster download speeds on a variety of smartphone devices.

Sprint Spark

Sprint finally gave some hints regarding the rollout plans for Project Spark, saying it would reach 100 of America's largest cities in the next 3 years.  It today turned on 6 new cities this week, including Orlando, Florida and Oakland, California.  In total, 24 markets now have Project Spark grade coverage.
Last, but not least, Sprint's family plan marketing appears to be working reasonably well.  It enrolled 3 million subscribers in its "Framily" (Friends + Family) plan, which is showing early signs of success.


The only real disappointment for Sprint was after Q4 2013's brief return to subscriber growth, Sprint shed 231,000 net subscribers amidst increased churn.  It also lost 334,000 prepaid customers, but that number is actually far smaller when you take away a temporarily blip from Lifeline customers, whose Sprint subscriptions will be renewed after recertification.  While losing customers at any rate isn't ideal, those numbers compare favorably to Q1 2013, when Sprint lost 560,000 customers.
Sprint also announced a new deal with fast-growing internet radio provider Spotify to offer discounted or free subscriptions to its customers.  Under the deal, Sprint Framily smartphones will come bundled with 6 free months of Spotify.  After that you will be given a discounted rate of either $4.99 (for Framily plans with more than 5 members) or $7.99 USD per month (for Framily plans with 2-4 members).  Non-Framily plan members will get only 3 free months and will be stuck paying the full rate -- $9.99 USD per month.

Spotify on Android
Framily plan members will get up to six months of Spotify service for free, and as much as half off their monthly subscription after that.

It looks like Sprint is finally showing signs of recovery under the patient hand of its new owner, Japan's Softbank Corp. (TYO:9984).  

Given Sprint's ongoing price war with Deustsche Telekom AG's (ETR:DTE) T-Mobile USA brand, a key ongoing storyline to watch is Sprint/Softbank's reported intention to field a merger bid for this rival.  The move would combine America's third and fourth largest carriers, but is being frowned on by regulators who fear it would limit competition.  Given that these same regulators already killed a prospective T-Mobile purchase by AT&T, Inc. (T), it seems unlikely that Sprint will seriously pursue the plan.

T-Mobile wide
[Image Source: Flickr (top); Getty Images (bottom)]

But without or without T-Mobile, Sprint looks to finally be finding its way back to success.

Sources: Sprint [press release], ValueWalk

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