Sprint Nextel Corp., the nation’s third-largest wireless service provider, on Monday reported a larger first-quarter loss on declining revenue and a charge for job cuts announced in January.
But its adjusted results narrowly beat estimates and its shares climbed 14 percent in morning trading.
Sprint continued to lose subscribers but far fewer than it did in the last three months of 2008. The improvement, however, reflected a sharp increase in prepaid customers while the number of subscribers who sign up for annual contracts and are more valuable to Sprint fell.
“Total subscriber sequential improvement performance was the best in Sprint Nextel history,” Chief Executive Officer Dan Hesse told analysts during a conference call. “But we are far from satisfied with our postpaid subscriber numbers.”
The Overland Park, Kan.-based company said it lost $594 million, or 21 cents per share, during the three months ending March 31, versus a loss of $505 million, or 18 cents per share, a year ago.
Not including one-time charges for severance and other job-cutting costs, Sprint said it would have lost 3 cents per share, a penny less than analysts surveyed by Thomson Reuters had predicted.
The company said it recorded a $327 million charge for severance and other costs connected with its announcement in January that is planned to cut 8,000 jobs.
The Wall Street Journal, citing unnamed sources, reported on Monday that Sprint was in final discussions to outsource management of its cellular network — and transfer between 5,000 and 7,000 U.S. jobs — to Telefon AB L.M. Ericsson.
In a telephone interview, Hesse said the company was looking at several cost-cutting ideas, including “analyzing the possibility of outsourcing certain parts of the management of our network assets but no decisions have been made and we don’t comment on speculation.”
Revenue declined 12 percent to $8.21 billion from $9.3 billion and below…