Sprint and Alltel Report Strong Wireless Earnings, Lucent Plans Manufacturing Overhaul

Strategic Insights -

The quarterly earnings reports from major wireless players have shaken off last week's market downturns, with Sprint PCS and Alltel reporting significant improvements in their financials. Sprint's first-quarter results exceeded Wall Street's expectations, with the company adding 831,000 new customers and achieving revenues of $1.18 billion, a 95% surge from last year. Alltel, on the other hand, reported a 12% increase in operating income from mobile telecom services, adding 105,000 wireless customers. Lucent Technologies, a leading wireless equipment provider, also reported a 41% jump in second-quarter profits, with plans to outsource manufacturing to boost cash flow.

Key Takeaways:

  • Sprint PCS reported better-than-expected first-quarter results, adding 831,000 new customers and achieving revenues of $1.18 billion, a 95% surge from last year.
  • Sprint's wireless losses declined from 71 cents a share last year to 54 cents, and the company expects to add over 800,000 new subscribers in the second quarter.
  • Alltel added 105,000 wireless customers and saw its operating income from mobile telecom services increase 12% from 1999 to $221 million.
  • Lucent Technologies reported a 41% jump in second-quarter profits and plans to outsource all but its most high-tech equipment manufacturing to boost cash flow and meet customers' needs more quickly.
  • Sprint ended the first quarter with over 6.5 million wireless subscribers, a significant increase from previous years.
  • Lucent will sell some of its 17 U.S. manufacturing plants to contract manufacturing partners as part of its manufacturing overhaul.

Statistics:

  • Sprint PCS added 831,000 new customers, exceeding Wall Street projections of 711,400 new accounts by 14%.
  • Sprint's revenues surged 95% to $1.18 billion from $604 million in the prior year.
  • Alltel added 105,000 wireless customers and saw its operating income from mobile telecom services increase 12% to $221 million.
  • Lucent Technologies reported a 41% jump in second-quarter profits.
  • Sprint expects to add over 800,000 new subscribers in the second quarter.
  • Lucent plans to sell 17 U.S. manufacturing plants to contract manufacturing partners as part of its manufacturing overhaul.

Sources:

  • "Sprint PCS" is scheduled to report its second-quarter earnings next Tuesday (Wall Street Journal, April 18, 2000)
  • "PCS adds more than 831,000 customers" by Russ Jusell (Dallas Morning News, April 15, 2000)
  • "Alltel adds 105,000 wireless customers" by Russell Adams (Arkansas Democrat-Gazette, April 17, 2000)
  • "Lucent Technologies" is scheduled to report its second-quarter earnings next Thursday (Bloomberg, April 20, 2000)