October 27, 2010, 5:19 PM — Sprint Nextel Corp. on Wednesday reported a third-quarter loss of $911 million, or 30 cents per share, compared with a loss of $478 million, or 17 cents per share, in the year-ago quarter.
The wireless carrier announced Q3 results before Wednesday's trading session, prompting a daylong drubbing. Sprint shares (NYSE: S) plunged immediately and finished the day down 47 cents, or 9.85 percent, to 4.30. Even after Wednesday's plunge, Sprint is up 17 percent for the year.
The good news for Sprint and its shareholders is that organic revenue increased 1.5 percent to $8.15 billion from $8.04 billion in last year's Q3, while it also added a net 644,000 customers. Sprint is the third-largest wireless carrier in the U.S., trailing only Verizon Wireless and AT&T.
Sprint is making a big push with its 4G Sprint service, launching the high-speed wireless option in 19 cities during Q3, bringing the total to 55 markets. However, Verizon Wireless is closing in, with plans to have 4G coverage in 38 markets by year's end.
Complicating Sprint's challenge are the cash problems of its partner, Clearwire, of which Sprint owns a majority share. Unless Clearwire gets an infusion of cash next year, it's future is uncertain. Other investors in the company, such as Comcast and Time Warner Cable, have said they won't be cutting checks for Clearwire any time soon, putting the burden on Sprint.
In an earnings conference call Wednesday, CEO Dan Hesse declined to say whether Sprint would provide Clearwire with more capital.
Chris Nerney writes about the business side of technology market strategies and trends, legal issues, leadership changes, mergers, venture capital, IPOs and technology stocks. Follow him on Twitter @ChrisNerney.