Sprint Nextel 4th Qaurter 2006 Results

[Barry]

Sprint Nextel confirmed its fourth quarter customer numbers with the release of its full financials. One one hand they saw customer loss increase in the 4th quarter, but preliminary 1st quarter results of this year show a 32-percent increase in profits for the quarter.

Sprint announced in early January that it expected to report a loss of about 306,000 postpaid customers during the fourth quarter, reflecting continued losses from the Nextel side of its business. Sprint Nextel gained 742,000 overall net customers during the fourth quarter.

According to Sprint Nextel, it gained more than 1.3 million net CDMA postpaid, wholesale and affiliate customers during the fourth quarter; that figure was offset by losses on the iDEN side. The carrier ended the quarter with a subscriber base of 53.1 million. The number keeps Sprint Nextel in third place among national carriers, but the carrier is not keeping pace with the growth of larger competitors Verizon Wireless and Cingular Wireless L.L.C.

Sprint Nextel’s churn rate was up from 2.1 percent in the fourth quarter of 2005 to 2.3 percent in 2006’s fourth quarter, although the rate fell slightly from 2.4 percent in the third quarter of 2006. Prepaid churn among customers of the company’s Boost Mobile L.L.C. sub-brand also increased, from 4.8 percent to 6.5 percent during the fourth quarters of 2005 and 2006. Boost’s ARPU plunged 14 percent year-over-year to just under $32.

The carrier said its data revenues increased 66 percent compared with the fourth quarter of 2005, and contributed $8.75 to overall ARPU and almost $12, or 20 percent, of CDMA postpaid ARPU.

Wireless revenues were up 9 percent year-over-year to $9 billion for the fourth quarter. Sprint Nextel reported that its net income for the fourth quarter was up 32 percent to $261 million, but down almost 26 percent from the full-year results for 2005.

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