Grant Gross
Senior Writer

Sprint records $1.9 billion loss on impairment charge

news
Oct 19, 20042 mins

Sprint beats analysts' expectations despite loss due to re-evaluation of its long distance network assets

Sprint Corp. reported Tuesday a $1.91 billion net loss for the third quarter, due to a previously announced re-evaluation of its long distance network assets, but beat analysts’ expectations for the quarter.

Sprint’s third quarter financial statement included a $3.5 billion impairment charge for long-distance assets. The company also reported a $1.2 billion write-down of its Multichannel Multipoint Distribution Service (MMDS) spectrum. The company suspended deployment of its MMDS wireless cable broadband service in late 2001.

Not including those charges and other special items, Sprint reported adjusted operating income of $844 million, up 6.4 percent from $793 million posted during the quarter ending Sept. 30, 2003.

Without the special items, Sprint reported adjusted earnings per share of $0.24 per share, up from $0.19 per share a year earlier. The adjusted earnings per share exceeded the $0.21 per share expected by analysts surveyed by Thomson First Call.

Sprint’s net operating revenues for the quarter rose 3.1 percent from the third quarter of 2003, from $6.71 billion to $6.92 billion. Sprint’s wireless division posted particularly healthy numbers, with operating income rising nearly 49 percent over the third quarter of 2003, from $303 million to $451 million.

Net operating revenues for the wireless division were $3.76 billion, up 12.6 percent from the third quarter of 2003.

Sprint announced Oct. 15 that it planned to report a pretax noncash impairment charge reducing the value of its long-distance network assets.

The company decided to take the charge after analyzing long-distance business trends “that took into account current industry and competitive conditions, recent regulatory rulings, evolving technologies and the company’s strategy to expand its position as a leader in telecom solutions,” a company news release said then.

Grant Gross

Grant Gross, a senior writer at CIO, is a long-time IT journalist who has focused on AI, enterprise technology, and tech policy. He previously served as Washington, D.C., correspondent and later senior editor at IDG News Service. Earlier in his career, he was managing editor at Linux.com and news editor at tech careers site Techies.com. As a tech policy expert, he has appeared on C-SPAN and the giant NTN24 Spanish-language cable news network. In the distant past, he worked as a reporter and editor at newspapers in Minnesota and the Dakotas. A finalist for Best Range of Work by a Single Author for both the Eddie Awards and the Neal Awards, Grant was recently recognized with an ASBPE Regional Silver award for his article “Agentic AI: Decisive, operational AI arrives in business.”

More from this author