Tag Archive for "Earnings" tag

During its fourth quarter 2008 earnings call today, Clearwire CEO Ben Wolff remained guarded about the exact number of markets the WiMAX provider will launch this year, but rattled off a list of at least eight markets where he said he expects the Clear-branded service will make its debut. Those markets include Las Vegas, Atlanta, Chicago, Philadelphia and Dallas/Ft. Worth. In addition, the company will convert existing pre-WiMAX markets in Seattle, Honolulu and Charlotte to mobile WiMAX and expand the coverage area in Baltimore, which is a Sprint Xohm market that will be converted to Clear.  

The company also reported consolidated revenue of $20.5 million. Average revenue per user was up 10 percent to $39.70, up from $36.09 in fourth quarter of 2007.  The number of VoIP customers also doubled from 10 percent in in the year-ago quarter to 20 percent in the fourth quarter of 2009. The company added 5,000 net new subscribers for a total subscriber base of 475,000.  Churn was 2.8 percent, up from 2.4 percent in the prior year’s quarter.

Here’s a breakdown of the other key points from the announcement:

Markets: By the end of 2010, Wolff said that the Clearwire network will cover 120 million covered POPs and that will include markets such as New York, Boston, Washington, D.C., Houston and San Francisco.  However, he also added that the company does not need to expand to 100 markets for it to succeed. Nationwide roaming is not a requirement for success, he said, adding that the company will launch a dual-mode WiMAX/CDMA 1xEVDO modem this summer that will let customers roam on Sprint’s 3G network when out of the Clearwire service area. 

Devices: Wolff talked about a “personal” hotspot device that will launch at the end of the month that will combine WiMAX and WiFi and he said that there will be at least 100 mobile WiMAX devices–including laptops, netbooks, handhelds and USB modems available to customers by year-end.  

MSOs and other resellers: Expect the cable companies and Sprint to begin selling WiMAX services in the second half of the year. Both are collaborating with Clearwire on product development.

Backhaul: The company says that 70 percent of the Las Vegas and Atlanta markets will use microwave technology for backhaul because it is much cheaper than using terrestrial backhaul.

Cash: Wolff says the company is managing and conserving its cash so it can go until 2011 without additional funding. The company expects to spend between $1.5 billion and $1.9 billion this year.

For more:
- See this press release

Related articles:
Clearwire investors gain larger stake in company
The pros and cons of Clearwire
New Clearwire announces ‘Clear’ brand
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Virgin Mobile USA reported a net loss in the fourth quarter of 2008 of $4.4 million, compared to a net loss of $14.7 million in the year-ago quarter. However, the prepaid MVNO had a positive net income of $7.9 million for the full year, compared to $4.2 million for 2007, and increased its subscriber base for the year by 6 percent. 

Revenue: Virgin Mobile had a net service revenue of $326.7 million in the quarter, a 10 percent increase compared to the year-ago quarter. For all of 2008, Virgin Mobile’s net service revenue was $1.2 billion, consistent with net service revenue in 2007.

Subscriber additions: The carrier had 216,000 net additions in the quarter, up 3 percent from the year-ago period. Virgin also reported that it ended 2008 with 5.38 million total subscribers, compared to 5.1 million at the end of 2007. The company said it had more than 3.3 million gross additions during the year.

Churn: The carrier said churn for the fourth quarter was 4.8 percent, down from 5.5 percent in the third quarter of 2008 and 5.1 percent in the year-ago period.

ARPU: Virgin Mobile reported ARPU of $21.14, a 4 percent increase from $20.36 in the year-ago quarter and a 3 percent bump from the third quarter of 2008. ARPU for the full year was $20.30, a 4 percent decline compared to $21.24 in 2007. The company said ARPU in the fourth quarter benefited from the launch of its revised hybrid plans in the second quarter of 2008.

For more:
- see this release

Related Articles:
Virgin Mobile USA cuts 10 percent of workforce
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Virgin Mobile USA has 216K net adds in Q4
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Sprint Nextel, after hemorrhaging subscribers throughout 2008, is predicting a 6 percent drop in wireless service revenue in 2009.

The carrier, which lost 1.3 million total customers in the fourth quarter of 2008, is also predicting that if subscriber losses continue at the same pace as last year, the company will see an additional 5 percent drop in wireless revenue. The forecasts were made in a filing to the Securities and Exchange Commission that Sprint made this past Friday.

Sprint lost 5.1 million subscribers in 2008, and wireless revenue fell by 3.1 billion, or 32 percent, as compared to 2007. When the carrier reported its fourth quarter earnings Feb. 19, revenue fell to $35.64 billion, down 11.2 percent from revenue of $40.15 billion in the year-ago quarter.   

The carrier said in January that it was laying off 8,000 employees in an effort to cut costs and save $1.2 billion annually. Sprint has also tried other efforts to retain customers, including offering wireless plans with perks for loyal customers and a new series of flat-rate, unlimited plans for Nextel Direct Connect customers. 

For more:
- see this article

Related Articles:
Sprint Nextel loses 1.3M subs in fourth quarter
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Sprint Nextel to cut 8,000 jobs
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Sprint loses 1.3M net subs, base drops to 50.5M

Research In Motion projected margins and earnings for its fiscal fourth quarter at the low end of its previously announced forecast despite predicting stronger subscriber growth.

The BlackBerry maker said it expected revenue for the quarter, which ends Feb. 28, to come in around the midpoint of the previously predicted range, with gross margin and earnings at the low end. In December, RIM projected revenue between $3.3 billion and $3.5 billion and margins of 40 to 41 percent.

RIM also said it expected BlackBerry subscribers to grow to 2.9 million, up from 2.6 million in its fiscal third quarter, on the strength of continued growth after the holiday shopping season. However, the lower margins and earnings could forebode a drop in sales of some of RIM’s newer, more high-end smartphones such as the Storm and the Bold and an increase in demand for older and less expensive models. The company said it expected “more normalized” growth in the fiscal first quarter.   

“RIM achieved a very strong start to the holiday buying season and the momentum carried on stronger than expected during the past seven weeks, despite a seasonally slower time frame and the challenging economic environment,” said co-CEO Jim Balsillie.

Despite the growth in market share for the company, RIM has faced growing competition from Apple’s iPhone 3G, and may face more competition from a renewed Palm if its Pre smartphone proves to be a hit.

For more:
- see this article (sub. req.)

Related Articles:
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Verizon Communications said that CFO Doreen Toben would retire from the company in mid-2009, capping a seven year career with the company and more than 25 years in the telecom industry. Verizon said a successor would be named shortly.

Toben, 59, also an executive vice president at the company, has been CFO since 2002, and has been involved in almost all of the company’s key strategic decisions. 

“I have had the good fortune of working with what I consider to be the best financial team in business today, as well as Verizon’s superb senior leadership,” Toben said in a release. “I feel very good about how this company has transformed itself in a few short years to become the industry’s premier provider of network-based communications services.”

Toben played a key role in the series of mergers in the mid-1990’s that created Verizon. She was vice president and controller for Bell Atlantic in July 2000, when the company merged with GTE to form Verizon. She was also CFO of Bell Atlantic’s telecom operations, and had been vice president of finance and controller when Bell Atlantic merged with NYNEX in August 1997. Toben began her career in 1983 at AT&T in the treasury department.

Verizon Communications, which jointly owns Verizon Wireless along with Vodafone, reported fourth quarter earnings last week. While Verizon Wireless showed strong revenue growth, the company’s wireline businesses, Verizon Telecom and Verizon Business, had year-over-year revenue declines. Verizon Wireless, following its $28.1 billion acquisition of Alltel, is now the nation’s largest wireless operator, with over 80 million subscribers.

For more:
- see this article
- see this release

Related Articles:
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A lackluster economy has decelerated subscriptions.

Verizon Communications posted a 16 percent increase in net earnings for the fourth quarter.