In This Article:
A month has gone by since the last earnings report for Sprint (S). Shares have lost about 5.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Sprint due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Sprint Incurs Q1 Loss as Expected, Beats on Revenues
Sprint reported healthy first-quarter fiscal 2019 financial results, wherein the top line increased year over year and surpassed the Zacks Consensus Estimate.
Net Loss
For the June quarter, net loss was $111 million or loss of 3 cents per share against net income of $176 million or 4 cents per share in the year-ago quarter. The sharp decline was primarily due to higher net operating expenses. The bottom line matched the Zacks Consensus Estimate of loss of 3 cents.
Revenues
Quarterly total net operating revenues increased to $8,142 million from $8,125 million in the year-ago quarter mainly driven by higher equipment rentals. The top line surpassed the Zacks Consensus Estimate of $8,024 million. Overall service revenues were $5,563 million, down from $5,740 million in the year-ago quarter, while equipment sales totaled $1,220 million, up from $1,173 million. Equipment rentals increased to $1,359 million from $1,212 million.
Segment Results
Total net wireless operating revenues were $7,901 million compared with $7,845 million in the year-ago quarter, primarily due to higher equipment sales and rentals. Total service revenues declined to $5,322 million from $5,460 million. Postpaid revenues totaled $4,199 million and prepaid revenues were $843 million. Wholesale, affiliate and other revenues summed $280 million. The segment’s operating income was $590 million compared with $1,002 million in the year-ago quarter. Adjusted EBITDA was $3,037 million compared with $3,318 million in the prior-year quarter for respective margins of 57.1% and 60.8%.
Net operating wireline revenues were $307 million compared with $338 million a year ago. Operating loss for the segment was $54 million compared with operating loss of $96 million in the year-ago quarter.
Other Details
Total net operating expenses increased to $7,687 million from $7,310 million. Consequently, operating income for the reported quarter was $455 million compared with $815 million a year ago. Overall adjusted EBITDA was $3,042 million compared with $3,280 million and adjusted EBITDA margin declined to 54.7% from 57.1%.
Cash Flow & Liquidity
During the first quarter of fiscal 2019, Sprint generated $2,244 million of net cash from operating activities compared with $2,430 million in the year-ago quarter. As of Jun 30, 2019, the wireless carrier had $4,869 million in cash and equivalents with $35,073 million of long-term debt and finance lease obligations.