Sprint takes huge charge related to its brand name

Sprint takes huge charge related to its brand name
Struggling mobile carrier Sprint has taken a huge charge of $1.9 billion to write down the value of the Sprint brand. This comes after a poor fourth quarter that saw the carrier lose 205,000 postpaid customers during the last three months of the year. The company's churn rate was higher at 2.3% and revenue declined 1.8%.

The mobile operator's CEO, Marcelo Claure, says that the trajectory of Sprint's business is changing. Claure says that Sprint is making progress in adding new customers with aggressive promotional plans such as the one that cuts Verizon and AT&T subscribers' bills in half if they switch to Sprint. Still, as we pointed out, after turning in your handset as required and replacing it with a new one, your savings are closer to 20%.

Sprint is also looking to close the gap it has with the competition in terms of the number of retail stores it operates. It trails T-Mobile by 600 stores and is 3000 locations shy of Verizon's total. The company is said to be in talks with Radio Shack to pick up leases on as many as 2000 retail locations that the electronics retailer is looking to close under bankruptcy protection.


Claure says that Sprint still has enough cash in the bank to fund operations. Just in case of a funding shortage, he says that the carrier would consider selling some of its 2.5GHz spectrum, which is highly valued. Sprint predicts that its earnings (after adjustments) will rise 5% to 7% this year. Hopefully, Sprint can finish with the network build out that has plagued customers and has led them to leave the mobile operator for one of its rivals.

source: WSJ

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