Sprint: Long-Distance Sinking, Wireless Thriving

Sprint Corp. reported a write-down of more than $1 billion, as it reported its third-quarter financial results on Tuesday. The nation's third-largest long-distance provider, Sprint wrote down the value of that network, but at the same time it became evident that the value of its wireless network was improving.

The firm had announced Friday that it would cut 700 positions, as it begins to downplay its long-distance business. The net loss was $1.91 billion against a $497 million loss during the like period last year. Revenues were $6.9 billion--up from $6.7 billion in last year's quarter.

Sprint and the other major long-distance providers--AT&T and MCI--have been under mounting pressure, as regulatory and legal developments have made it more difficult for the long-distance firms to compete with the former regional Bell operating companies (RBOCs.) On Monday, MCI said it would write down $3.5 billion to account for the lowered value of its long-distance network. AT&T had previously said it would take a $12.5 billion charge for its sinking consumer network.

With Sprint's long-distance revenue in a remorseless drop for the past 15 quarters, the firm has been looking to its cell-phone business and its bundled services as a solution to its problems.

"Sprint Consumer Solutions reported 4 percent sequential growth [over the previous quarter] of revenues on strong wireless performance," the firm stated. "Sprint Local Consumer Solutions reported a 1 percent sequential increase, and Sprint Business Solutions reported a 2 percent sequential decline, as lower wireline revenues were partially offset by growth in wireless."The firm reported strong DSL gains. Sprint also noted that the recent spate of hurricanes in its territory has a negative on both wireline and wireless segments.

"Our steady execution has led to consistent improvements in revenues, profitability, and cash generation, and we are on track to meet our net debt-reduction targets," said Sprint chairman and chief executive officer Gary Forsee in a statement. "Our recent announcement to further align resources with customer demand will enable us to more fully leverage our portfolio of assets and capabilities, as we increasingly distinguish Sprint as a one-stop shop for services."