Sprint Churn Rises, Losses Mount

Sprint Nextel Corp. (NYSE: S) yesterday reported it lost $505 million and nearly 1.1 million long term customers in the first quarter as the telecom firm continues to struggle against its larger rivals AT&T and Verizon Wireless.

Revenues declined 7.5 percent to $9.3 billion. Average revenue per postpaid customers, those who have signed long term contracts, came in at $56, a decline of 6 percent. Sprint’s subscriber list fell to 52.8 million, down 1.5 percent from the first quarter a year ago.

The churn rate for postpaid subscribers rose to 2.45 percent from 2.3 percent. That is more than 40 percent higher than AT&T's churn rate of 1.7 percent and more than double that of Verizon with 1.19 percent ("Verizon Profits Up As it Adds Wireless Customers, Cuts Churn," April 28).

Sprint is considering selling its Nextel subsidiary that it bought in 2005. It wrote off much of that investment in the fourth quarter of 2007, leading to a $29.5 billion loss. Last week, Sprint announced a joint venture with Clearwire Corp. to offer a $14.5 billion high-speed wireless service.