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Sprint CEO: Subs 'shouldn't have to pay more' for same network performance


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Sprint CEO: Subs 'shouldn't have to pay more' for same network performance

Althoughits loss widened in the first quarter of its fiscal 2016, reported advances withkey metrics tied to postpaid phone users.

Thecarrier posted 377,000 total net additions in the quarter, including a net gainof 173,000 postpaid customers — those billed for service on a monthly basis —during the three months ended June 30, marking the fourth consecutive quarterof improvement with the latter measure.

CEOMarcelo Claure, in a conference call with analysts on July 25, said Sprint is "continuingto execute on our turnaround plan."

"MoreVerizon Communications Inc.customers switched to Sprint than … Sprint customers left for Verizon and thiswas the case with AT&T Inc.and T-Mobile US well," he said.

Claurealso noted postpaid phone churn, improving for the sixth consecutive quarter,was the lowest in the company's history at 1.39%. He attributed the progress tonetwork amelioration, with its LTE Plus Network delivering faster downloadspeeds than its three competitors.

Healso touted the effectiveness of Sprint's current ad campaign, featuring PaulMarcarelli, the actor who previously asked "Can you hear me now?" forVerizon. Claure said that with networks now being on level playing fields "customersshouldn't have to pay more." He called the campaign one of the mostsuccessful in the company's history, generating 1 billion impressions.

Totaloperating revenues for the period totaled $8.01 billion, down slightly from $8.03billion in the first fiscal quarter of 2015.

Sprintposted a net loss of $302 million, or 8 cents per share in the quarter,including $113 million of nonrecurring contract termination charges primarilyrelated to the termination of the pre-existing wholesale arrangement withNTELOS Holdings Corp.,versus a net loss of $20 million in the year-ago period.

TheS&P Capital IQ consensus normalized EPS estimate for the first quarter wassix cents, while the EPS estimate on a GAAP basis was nine cents.

Thecompany recorded operating income of $361 million in the period, down from $501million in the year-ago quarter. Adjusting for the aforementioned contracttermination charges related to NTELOS, operating income would have beenrelatively flat year over year.

AdjustedEBITDA of $2.5 billion in the quarter grew 18% from the prior year period,primarily because of expense reductions.

Thecompany also reaffirmed full-year guidance forecasts. Operating income will bein the $1 billion to $1.5 billion range. Full-year capital spending will reach$3 billion, excluding phone-leasing costs, while adjusted EBITDA is expected tofinish in the $9.5 billion to $10 billion range.