- Sprint (NYSE:S) is up 12.7% now after fiscal Q3 results where the company raised its outlook and added subscribers, though a heavy promotional approach has interest turning to future cash flows.
- It added 501,000 net postpaid connections; 366,000 net postpaid phone adds, not far off Verizon's 449,000 (but well behind T-Mobile). Postpaid churn dropped, but on the company's earnings call, CFO Tarek Robbiati suggested that's not the only measure of customer base quality: "Bad debt is a measure of that quality" also, he says: "We're not bottom fishing." CEO Marcelo Claure concurred: "We're pretty much happy with the type of customers we're bringing."
- Claure didn't offer details about network plans, but countered media reports of a massive network overhaul: It's "not a rip and replace strategy ... we are deploying small cells" based on data.
- Wells Fargo's Jennifer Fritzsche -- who was eager to hear the results since the "story is not that bad" -- said the real story of Q3 is liquidity. "By offering FY2016 guide which implies 25% y/y growth, and confidence in future tranches and new network financing facility, we believe it should give enough confidence to the market about S’s liquidity position and its ability to handle future maturities. This is KEY to the story, and we look for color regarding FCF timing and more details surrounding network financing."
- On the call, Robbiati alluded to concerns about free cash flow timing, suggesting that the company's leasing model plays a role there as well as execution timing on the company's cost reductions.
- Previously: Sprint jumps 15.1% as Q3 adds subscribers, beats profit expectations (Jan. 26 2016)
- Previously: Sprint reports FQ3 results (Jan. 26 2016)
- Previously: Sprint -11.2% as it plans to cut 7% of workforce (Jan. 25 2016)