Categories Earnings, Technology

Sprint (NYSE: S) Q3 earnings preview: T-Mobile deal in spotlight

Sprint Corporation (NYSE: S) is slated to report its third-quarter 2019 earnings results on Monday, January 27, before the market opens. The results will be hurt by lower revenue as well as higher costs and expenses. Investors expect additional details about the merger deal with T-Mobile (NASDAQ: TMUS).

The market experts believe that the deal could turn fruitful after a virtually sure outcome from the trial that will need to go through to a verdict. The verdict is expected to take place between the end of February and mid-March as the closing arguments began on January 6.

Telecommunication tower
Image for representation. Courtesy: Tony Stoddard on Unsplash

Meanwhile, T-Mobile operating chief Mike Sievert remained confident of the deal to wrap up quickly. A settlement with the suing is never off the table despite the wrap of testimony in the trial of several states vs. Sprint/T-Mobile. If the deal is not completed, it is expected that Sprint will not be able to deploy a nationwide 5G network on the same scale and on the same timeline as the combined company.

While the company launched 5G in select cities in the first half of 2019 and Sprint plans to continue to invest in its network during the next few years, many of the underlying service quality, scale, and financial challenges remain. The company aims to use its spectrum to build its 5G network on the 2.5 GHz spectrum.

Since mid-2013, the company has experienced net losses in postpaid handset subscribers. The trends improved from the quarter ended September 30, 2015, after the release of price plans associated with device financing options. However, since the quarter ended September 30, 2018, through the current quarter, the company incurred net losses in the postpaid handset subscribers.

Read: AT&T Q3 earnings review

Analysts expect the company to post a loss of $0.05 per share on revenue of $8.21 billion for the third quarter. In comparison, during the previous year quarter, Sprint reported a loss of $0.03 per share on revenue of $8.6 billion. The company has missed analysts’ expectations thrice in the past four quarters. The majority of the analysts recommended a “hold” rating with an average price target of $6.27.

For the second quarter, Sprint reported a loss compared to a profit last year due to an 8% decline in revenues. Total wireless service revenue declined 7% due to lower Lifeline revenue and the continued amortization of prepaid contract balances. Postpaid wireless service revenue was relatively flat as the company works to stabilize postpaid ARPA and average postpaid accounts.

We’re on Apple News! Follow us to receive the latest stock market, earnings, and financial news at your fingertips

Most Popular

What to look for when CVS Health (CVS) reports Q3 earnings

Healthcare company CVS Health Corporation (NYSE: CVS) is all set to report earnings next week, with Wall Street expecting a mixed outcome. The company has been facing challenges in certain

eBay (EBAY): A few factors that helped drive growth in Q3 2024

Shares of eBay Inc. (NASDAQ: EBAY) stayed green on Friday. The stock has gained 32% year-to-date. The ecommerce leader delivered revenue and earnings growth for the third quarter of 2024,

CVX Earnings: Chevron reports lower revenue and profit for Q3 2024

Energy exploration company Chevron Corporation (NYSE: CVX) on Friday announced third-quarter 2024 financial results, reporting a decline in net profit and revenues. Net income attributable to Chevron Corporation dropped to

Tags

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top