Sprint CEO Marcelo Claure calls return to profitability “important milestone”
Amid on-again, off-again merger and acquisition discussion regarding U.S. carrier Sprint, the company on Tuesday morning released Q1 2017 financial reports indicating a return to profitability for the first time in three years.
Sprint, in a statement released to investors, reported net income of $206 million in the first quarter of 2017, along with operating income of $1.2 billion and an adjusted EBITDA of $2.9 billion.
This is the first time in three years Sprint has reported profitability, and the highest EBITDA in a decade. The company also cut some $370 million in expenses year-over-year, and added 88,000 postpaid subscribers, the eighth consecutive quarter of net additions. Operating revenues hit $8.2 billion year-over-year, marking four consecutive quarters of growth in that metric.
“Sprint reached an important milestone this quarter by returning to profitability for the first time in three years,” CEO Marcelo Claure said in a statement. “This represents the progress of a turnaround journey that has delivered improvements in postpaid phone and prepaid customer growth, a return to top-line growth, and a significantly transformed cost structure.”
In comments to investors, Claure said: “It has been three years since I became CEO at Sprint and began our turnaround journey,” noting the latest financials mark “our best financial performance in almost a decade,” driven by growth in net operating revenue and reduction of operation expenses. “Our network continues to perform at best-ever levels,” he added, noting results of Ookla and RootMetrics. “I’m encouraged by our current momentum.”
Cost-cutting measures include reductions in services, selling, general and administrative costs. This is part of an ongoing efficiency plan that has cut more than $4 billion in expenses over the last nine quarters.
