Sprint Nextel Corp. today reported operating income of $29 million, and Adjusted OIBDA of $1.5 billion was the highest in nearly four years even as Sprint made significant investments in the business during the quarter. Sprint reported continued strong growth in the Sprint platform business, reaching highest-ever subscriber base and service revenue levels in the first quarter of 2013. Here are the details:
Operating income for the quarter was $29 million as compared to a loss of $255 million in the year-ago period. Consolidated net service revenues of nearly $8 billion were flat year-over-year as Sprint platform growth offset declines in Nextel platform and Wireline revenues. The company reported a net loss of $643 million and a diluted net loss of $.21 per share for the first quarter of 2013 as compared to a net loss of $863 million and a diluted net loss of $.29 per share in the first quarter of 2012.
Quarterly Adjusted OIBDA of $1.5 billion was the highest in nearly four years and improved by $311 million as compared to the first quarter of 2012. Adjusted OIBDA improved year-over-year primarily due to growth in Sprint platform service revenue, lower cost of service and lower SG&A expense, partially offset by lower Nextel revenue.
Sprint platform service revenue reached best-ever levels in the first quarter driven by all-time high postpaid ARPU and subscribers for the Sprint platform. Sprint platform postpaid ARPU grew by more than $1 year-over-year. Postpaid subscriber growth on the platform continued to benefit from better than expected recapture rates of Nextel customers as well as improved postpaid churn. Additionally, all three of the Sprint platform prepaid brands achieved net additions in the quarter and each reached highest-ever subscriber levels.
Eighty-six percent of quarterly Sprint platform postpaid handset sales were smartphones, including more than 1.5 million iPhones sold during the quarter. Forty-three percent of iPhone sales were to new customers, a rate that continues to outperform larger competitors.
Sprint continued to enhance its smartphone portfolio - launching HTC One earlier this month and announcing plans to offer Samsung Galaxy S 4 in the next few weeks as well as BlackBerry Q10 and two Windows 8 phones later this year.
The company expects 2013 Adjusted OIBDA to be at the high-end of the previous forecast of between $5.2 billion and $5.5 billion excluding the effects of the closing of strategic transactions.