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The Reston [Va.] company lost $211 million [7 cents per share] during the quarter ended Mar. 31, compared to $164 million earned [5 cents] during the same period last year. Ever since Sprint bought Nextel in 2004 in a $35 billion deal, the merged giant has struggled with spikes in customer defections and drops in per-user revenue. The number of Sprint Nextel customers who paid for their phone usage at the end of the month declined by 220,000 during the March quarter, bringing the total number of post-paid subscribers to 41.6 million.
A bright point was that the company's wireless business added nearly 600,000 subscribers and ended the quarter with 53.6 million total, or 10% more compared to the same period last year. But much of the gains came from prepaid customers, who don't tend to pay as much or as regularly.
Even so, sales haven't picked up much yet. Sprint's total revenue amounted to $10.1 billion during the March quarter, with wireless revenue accounting for $8.7 billion and wireline $1.6 billion. During the same period last year Sprint had $10.07 billion in sales.
Investors grew more optimistic and bid up Sprint's stock by 2.7% to $20.54 per share in early trading on the New York Stock Exchange after the news on May 2. The stock price has risen from its 52-week low of $15.92 on Aug. 22.Lets look at what went wrong so far with this merger:
1) The name of the new company: “Sprint, together with Nextel”. Reminds me of “the artist formerly knows a Prince, or the” Los Angeles Dodgers of Anaheim”.
2) They wonder why they are losing business customers but still don’t offer phones that work internationally. Cingular offers a dozen or more.
3) The Sprint IVR menu to access sales and service is one of the worst I have ever used – not a good thing for a phone company.
4) I have had long waits every time I have been in a Sprint store for sales help.
5) My company’s two-year contract expires with Sprint in a few days. I have not heard once from Sprint about renewing my contract.
There may be an opportunity to sell short.
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