Sprint gains subscribers for first time since 2007

sprint lte and merging with t mobile might make sense ceo dan hesse  july 2010

Number-three wireless operator Sprint has announced its results for its fourth quarter of 2010—and, hence, the entire 2010 fiscal year—and delivered a surprise: the carrier added nearly 1.1 million wireless subscribers during the fourth quarter, the first time Sprint has added subscribers during a quarter in more than three years. Sprint also managed to narrow its losses, down from $980 million from the fourth quarter of 2009 to $929 million for the fourth quarter of 2010.

“I am pleased with the progress Sprint made in 2010 in each of our three focus areas,” said Sprint CEO Dan Hesse in a statement. “Sprint’s customer experience and brand continued to strengthen during the year, and we generated excellent cash flow. It had been almost five years since we added over a million customers in a quarter, and the annual improvement in postpaid subscriber results of 2.7 million vs. the previous year is unprecedented in the history of the U.S. wireless industry.”

Although only 58,000 of those new subscribers represent new customers signing on to two-year contracts, that number is substantially higher than what industry watchers were expecting for the quarter, which was generally fewer than 20,000 new postpaid subscribers. Another hopeful sign for Sprint’s mobile efforts includes its postpaid churn rate dropping from 2.10 percent in the third quarter to 1.86 percent in the fourth quarter; pre-paid churn dropped from 5.32 percent to 4.93 percent. Overall, that means Sprint is not just beginning to attract new customers, but is doing a better job holding on to them.

Although it may be too early to say that Sprint has turned a corner in its years-long downward spiral in the mobile industry, the company’s fourth quarter results do offer a spark of hope that the company’s WiMax 4G and Android-centric smartphone strategy may pay off. However, the company is still facing stiff competition from the likes of AT&T and Verizon Wireless, both of which not only offer the iPhone for sale, but will also be muscling in on Sprint’s “4G” mobile broadband business with LTE and high-speed HSPA+ technologies.

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