Sprint slows Q4 wireline quarterly losses to 1% amidst year-over-year decline

Sprint's (NYSE: S) wireline segment continued to struggle in Q4 2011, but the provider held down losses as revenues declined less than 1 percent on a sequential basis to $1.1 billion. Revenues fell 14 percent on a year-over-year basis.

Sprint Q4 2011 slides

Click here for details from Sprint's investor presentation.

The service provider attributes the year-over-year decline to a reduction in intercompany rate, based on market prices, for voice and IP services sold to the wireless segment and the ongoing migration of wholesale cable VoIP customers off its IP platform.

In Q4 2011, net operating wireline expenses increased by less than 1 percent to almost $1 billion.

On a year-over-year basis, net operating expenses declined almost 9 percent year-over-year due to lower cost of service from continued declines in voice and cable IP volumes, improvement in SG&A expenses and lower depreciation expenses.

Meanwhile, wireline adjusted OIBDA was $178 million for the quarter, down from $267 million in Q4 2010 and $184 million in Q3 2011. The year-over-year decline in adjusted OIBDA was also a result of lower revenues, partially offset by cost reductions.

To drive up new revenue in the wireline segment, the focus for Sprint in 2012 will likely to continue to be on serving large multisite businesses with a suite of cloud-based services, IP voice, Ethernet and telepresence. On the Ethernet front, Sprint plans to deepen its presence into its 65 existing U.S. markets it serves while expanding into new domestic and international markets.

In addition to Ethernet, Sprint has been expanding its telepresence capabilities in-house and through targeted partnerships with global carriers like Tata Communications. To bridge the so-called islands of telepresence connectivity, Sprint and Tata joined seven other global service providers to create the Global Meeting Alliance.

From an overall financial perspective, Sprint reported adjusted OIBDA of $842 million for the fourth quarter and nearly $5.1 billion for the full year 2011.

Sprint shares dropped 1.6 percent Wednesday, despite beating analysts' estimates of a quarterly loss of 37 cents per share. The company posted a loss of 35 cents per share in Q4.

For more:
- see the release

Special report: Wireline in the fourth quarter 2011

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