Everything you need to know about Sprint’s recent ups and downs

By

Updated

Sprint has gone through a lot in the last few years

Sprint (S) has gone through a lot of ups and downs over the last few years. The company continues to lose money and its subscribers continue to migrate towards the better service that major U.S. telecom providers Verizon (VZ) and AT&T (T) offer.

Sprint’s acquisition of Nextel in 2005 turned out to be a disaster and Sprint had to ultimately shut it down last year. Continued losses led Sprint to near bankruptcy in 2013 before SoftBank (SFTBF) came to its rescue and acquired it.

Article continues below advertisement

To give strong competition to Verizon and AT&T, Sprint showed its intention to buy T-Mobile (TMUS) earlier this year. But Sprint recently decided to abandon its pursuit of T-Mobile, citing the expected opposition not only from the Justice Department’s antitrust review but also from the Federal Communications Commission, or FCC. Investors didn’t like this surrender. Sprint’s stock fell by about 20% in early August this year.

We discussed the potential merger of Sprint and T-Mobile and the impact that it could have on the U.S. telecom industry in a Market Realist series titled The latest word in telecom: Can SoftBank swing a T-Mobile deal?

Sprint net income

Sprint’s financial position’s improving at a slower pace

Although Sprint still continues to lose subscribers, its financial position has been improving—albeit at a slower rate.

As the chart above shows, its net income of $23 million in the last quarter was the best in the last few quarters. The graph shows a positive income in Q3 2013 because of the one-time non-cash gain, net of taxes, of $1.4 billion related to the write-up of Sprint’s previously held investment in Clearwire.

Otherwise, except for the last quarter, Sprint continues to lose money.

Advertisement

More From Market Realist