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Sprint Shows Impressive Financial Results from Fiscal Year 2017

Lately, Sprint has been sharing the limelight with T-Mobile after executives from the two companies announced that they were merging together. Since the merger still has to be approved by the FCC and US DOJ, it'll take some time before the two actually work together as one company. In the meantime, Sprint unveiled its earnings for Q4 2017 and 2017 fiscal year operating results.

In today's earnings call, Sprint unveiled that they had the highest annual retail phone net adds in five years. Not to mention, the company reported having the best profit ever with an annual operating income of $2.7 billion. It's also important to point out that the company gained its highest annual net income for the first time since 2006.

For its 2017 fiscal year, Sprint earned 1 million retail phone net adds in its postpaid and prepaid businesses. This number shows an improvement of over 1 million compared to the previous year's results.

In more detail, Sprint had 606,000 postpaid phone net additions; which marked its third consecutive year of net additions. This allowed the wireless carrier to reach the highest level in six years with their postpaid phone gross additions. In Q4 2017, there were 55,000 postpaid phone net adds.

As for its prepaid sector, there were 363,000 prepaid net additions instead of the 1 million net loss the company incurred last year. This shows an improvement of almost 1.4 million, thanks to Sprint's Boost Mobile brand. There was a 4.58 percent prepaid churn rate, which was counted as the lowest in three years. During Q4 2017, Sprint had 170,000 prepaid net additions.

Looking at Sprint's multi-year plan to improve its cost structure, the company showed continuous progress. In fiscal year 2017, Sprint reported around $1.1 billion of combined year-over-year reductions in terms of the costs of services and selling, administrative and general expenses. This marks the company's fourth consecutive year of over $1 billion Y-O-Y reductions. The company has been able to reduce its costs to around $6 billion over the last four years.

With things looking up for Sprint, the company has once again expressed plans to build a super-reliable, high-capacity mobile network through 5G. Since it has over 160MHz of 2.5 GHz spectrum among the top 100 markets, the company is one of the few operators with enough capacity for operating 5G and LTE at the same time.

Sprint hopes they can launch their first mobile 5G network in the country by Q2 2019.

Source: Sprint

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  1. Interesting, but I call B.S. on a lot of Sprint's "improvements"
    How much of the prepaid net additions are due to NOT Boost Mobile but VIRGIN MOBILE'S iPhone Unlimited everything for $1/mo for 12 months & later continued for $1/mo for 6 months.
    That "1.4 million" improvement in Sprint prepaid's gonna look pretty different in next year's numbers. LOL!
    And increase in phone sales.....yeah, the refurbished ones they sell cheap.

    1. Sour grapes. Sprint figures out how to make more money giving away free postpaid and prepaid phone service, and you're not happy.
      We sure are, after 10 months free unlimited service on two lines ($3.27/line tax). Nephew is. His new Virgin SE paid for itself in 6 months and he has another 6 months left, free. With postpaid coverage.
      Don't be bitter, try it. Promos are still running.

    2. I would say little to none. The virgin mobile free year is achieved by buying iphone at full price, Literally all customers who get iphones get them on payment plans from the big 4 carriers or even apple on payments.

    3. Is $650 cheaper than $450 + 12 * $40 or not? It's still promotional pricing and "a good deal". I still don't understand your point - front loading revenue (pay for 12 months of service in advance) with of back-end promises (keep delivering phone service for 12 months) is a time honored tactic of dying businesses (see: Ring Plus for a recent example). It's a gamble some people are willing to take, and a "deal" if they make good.

    4. iPhone SE cost $279 up front. A discount off the $399 list at the time. We bought early, so we got a year of Unlimited on Virgin for $1. We were paying ~$50/month total with another carrier before the deal.
      We saved $600 over 12 months, which paid the $280 for the new SE, and saves us an extra $320 for the balance of the year.
      The only way we could have spent less for our relative would have been to sign him up for Sprint postpaid unlimited year with BYOD. But he would have had a credit check, and he was a student not working. So the Virgin deal was the best around.

    5. How does one figure Sprint / Virgin Mobile is making money selling an iPhone SE @ $279 + (12 x $1) = $291
      $291/12 = $24.25/month price of phone included! ??
      They aren't making profits with deals like this especially when 80% will likely jump ship in months 13 or 14 once they get dinged for $50/mo service charge for the first time.

      I betcha Sprint threw in "future cash flow" type ca-ca into these earnings reports. Future cash that will never materialize especially with the $1/mo Virgin Mobile deal.

      Sour Grapes? Nope, not at all. I agree the Virgin Mobile deal is awesome for a lot of people. I am simply challenging stats like "1.4 million" swing in the prepaid sector is not sustainable once these VM $1/monthers get dinged with their first $50 monthly charge. They'll drop Sprint VM like a hot potato.

    6. I bet Sprint & Virgin retentions will be a busy place as BYOP free year & Virgin $1/mo. plans expire. Wonder how aggressive the retention offers will be.

  2. Wonder how many of those net postpaid adds are due to the free year BYOP offer? I have seen guesstimate that a quarter million have taken part in it.

    People who got in early are "renewing" for another year now by porting out & right back in w/another SSN account holder.

    Still impressive, I guess, re income/profits although I wouldn't be surprised to hear an analysis showing it to be smoke/mirrors.

  3. How much of the profits came from the new tax bill.

    1. It's not possible for operating income to be affected by anything related to taxes. It's strictly comparing how much customers paid versus how much Sprint spent.

    2. Virtually all businesses report their earnings before taxes, so the tax bill would have no effect on the report.

    3. Publically traded companies like Sprint are required to file quarterly financial reports listing revenue, expenses and profits, including after tax profit. All corporations, including Sprint received tax cuts the last two quarters which increased their profit after tax. See Sprint gets $7.2 billion profit from Trump’s corporate tax cut | The Kansas City Star for more information

  4. They must've had a master chef cook those books, because they look pretty well done to me.

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