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Sprint Nextel loss widens in second quarter

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It looks like US carrier Sprint Nextel delivered the good news first – announcing the acquisition of Virgin Mobile USA earlier in the week. Because the bad news followed on Wednesday, when Sprint recorded a net loss for the second quarter which increased 12 per cent year on year to $384m from $344m in the same period last year.

Meanwhile, net operating revenues fell 10 per cent year on year to $8.1bn.

The company had 48.8 million wireless customers at the end of the second quarter, down from 49.1 million at the end of the first quarter of 2009. This includes 34.4 million postpaid subscribers (25.1 million on CDMA, 8.3 million on iDEN, and one million Power Source users who use both networks), five million prepaid subscribers (4.4 million on iDEN and 600,000 on CDMA) and 9.3 million wholesale and affiliate subscribers, all on CDMA.

During the quarter, total wireless customers declined by approximately 257,000, including net losses of 991,000 postpaid customers. Which is where the acquisition of MVNO Virgin Mobile should come in handy.

Virgin is to be acquired by hosting partner Sprint for around $483m, giving the company an additional five million subscribers. Sprint said the addition of the Virgin Mobile brand complements its own Boost Mobile MVNO business, which is also focused on the prepaid market. Boost had over three million subscribers as of June 30, and the company said that both brands will continue to exist, serving existing and prospective customers.

It’s been a busy period for Sprint, in June the company launched the Palm Pre handset, and began preparations for the August launch of 4G WiMAX services in Las Vegas, Atlanta and Portland, with at least six more markets in its national network expected to follow in 2009.


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