NEW YORK (Reuters) – Sprint Nextel Corp posted a surprise quarterly profit excluding items, thanks to cost cuts and strong growth in a new service where customers pay for calls in advance, sending its shares up 12 percent.
However, the No. 3 U.S. mobile service suffered its worst ever loss of valuable monthly bill-paying customers, who sign contracts of up to two years, as they defected to rivals. Business clients also left due to the weak economy.
“There are no clear signs that the business has made its turn,” said Piper Jaffray analyst Christopher Larsen.
Sprint’s net loss swelled to $594 million, or 21 cents per share from $505 million, or 18 cents per share in the same quarter a year ago. Before items such as amortization, it had a per share profit of 3 cents, compared with the average analyst forecast for a loss of 4 cents, Reuters Estimates said.
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