Sprint Earnings: DIALS Above Revenue Estimate, Shares RINGING Higher

S&P 500 (NYSE:SPY) component Sprint Nextel Corporation (NYSE:S) reported its results for the second quarter. Sprint Nextel offers a range of wireless and wireline communications products and services.

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Sprint Nextel Corporation Earnings Cheat Sheet

Results: Loss widened to $1.37 billion (46 cents per diluted share) from $847 million (loss of 28 cents per share) in the same quarter a year earlier.

Revenue: Rose 6.4% to $8.84 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Sprint Nextel Corporation fell short of the mean analyst estimate of a loss of 41 cents per share. Analysts were expecting revenue of $8.73 billion.

Quoting Management: “The Sprint platform achieved best ever postpaid ARPU and customer churn that, combined with disciplined customer acquisition and cost management, contributed to our Adjusted OIBDA* of $1.45 billion,” said Dan Hesse, Sprint CEO. “Based on this performance, we are raising the 2012 Adjusted OIBDA* forecast to between $4.5 billion and $4.6 billion.”

Key Stats:

Last quarter marked the fifth straight quarter that the company saw shrinking gross margins, as gross margin fell 1.5 percentage points to 43.3% from the year-earlier quarter. Over that time, margins have contracted on average 3.3 percentage points per quarter on a year-over-year basis.

Revenue has increased for four consecutive quarters. Revenue increased 5.1% to $8.73 billion in the first quarter. The figure rose 5.1% in the fourth quarter of the last fiscal year from the year earlier and climbed 2.2% in the third quarter of the last fiscal year from the year-ago quarter.

The company fell short of forecasts after beating estimates in the previous two quarters. In the first quarter, it topped the mark by 13 cents, and in the fourth quarter of the last fiscal year, it was ahead by 3 cents.

Looking Forward: Analysts seem more negative about the company’s results for the next quarter than ninety days ago. The average estimate for the third quarter has moved from a loss of 37 cents a share to a loss of 42 cents over the last ninety days. For the fiscal year, the average estimate has moved from a loss of $1.51 a share to a loss of $1.57 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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