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.
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“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.