Sprint (NYSE: S) wireline revenues in the first quarter left a lot to desire as they declined 11 percent year-over-year to $893 million and 6 percent sequentially with sharp declines in both voice and Internet.
The service provider attributes the decline to an intercompany rate reduction based on market prices for voice and IP services sold to the wireless segment, in addition to lower voice, data and IP volumes.
It also reported that wireline net operating expenses declined about 6 percent year-over-year and 1 percent sequentially due to lower cost of service from continued declines in volumes to $866 million.
Net voice and Internet operating revenues declined sequentially to $352 million and $434 million, respectively, while data revenue only declined $2 million to $94 million.
Despite seeing declines across its three wireline business lines, the service provider has been gaining momentum in the wireline industry segment, selling its MPLS services to medium and large businesses. The service provider's effort to grow its domestic and global footprint drove up its profile from niche player to challenger on Gartner's latest Magic Quadrant for Global Network Service Providers.
Another key point in Sprint's wireline portfolio is Ethernet.
Sprint plans to offer a broader set of Carrier Ethernet services to its existing and new clients, while expanding its domestic footprint. Although Sprint has to rely on last mile partners to deliver Ethernet, the service is currently available in 147 markets domestically and 64 countries. In 2013, Sprint plans to expand to about 30 new domestic cities, which includes a combination of new cities and expansions within existing cities.
Sprint's overall income was $29 million, adding that Adjusted OIBDA of $1.5 billion was the highest in nearly four years despite making significant investments in the business during the quarter.
Shares of Sprint were listed at $7.09, down 0.01, or 0.14 percent, in Thursday morning trading on the New York Stock Exchange.
- see the earnings release (.pdf)
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