Huge writedown slams Sprint
Sprint (S) is admitting defeat in its 2005 merger with Nextel. The struggling telco posted a fourth-quarter loss of $29.5 billion, or $10.36 a share, reversing the year-ago profit of $261 million, or 9 cents a share. The latest quarter was hit by a $29.7 billion writedown of merger-related goodwill, reflecting the difference between the price Sprint paid and the actual value of the assests purchased. Excluding that gargantuan charge, Sprint made 21 cents a share on an adjusted basis, beating the 18-cent analyst consensus estimate. Revenue fell 6% from a year ago to $9.8 billion, missing the $9.95 billion Wall Street target.
“The fourth quarter financial results reflect the challenges facing our wireless business,” said CEO Dan Hesse, who took over late last year for Gary Forsee. Adjusted operating income at the wireless business plunged to $168 million from $652 million a year earlier, as Sprint continued to lose customers, pressuring service revenue. Fortune’s Michal Lev-Ram and Scott Moritz reported Wednesday that Sprint is having more and more trouble holding onto lucrative wireless postpaid users. In the fourth quarter, the company said, total post-paid subscribers declined by 683,000.
In response, Hesse said Sprint is taking steps to bolster its financial flexibility, by saying it won’t declare any dividends in the forseeable future and letting its $6 billion stock buyback plan expire. But the business is in such disarray that he’s taking his time to consider what needs to be done. “Internally, we have rolled out a unified company culture focused on accountability and on providing a superior customer experience,” he said Thursday. “We plan to share some of our initiatives for improving the customer experience and operations next quarter.” But, he cautions, “Strategic assessments and changes may take longer to complete.”
Good ..Sprint-Nextwl was/is a disastrous “merger”… The greedy execs who thought this up need to be shot in the head…since they’re brain dead anyway..Thankfully I’m a VERY happy Verizon client.Coverage is great,my phone works reliably EVERY time,customer service is VERY pro-active( they’ll do everything to remedy my concerns), the cost is very reasonable.A friend has been a Sprint customer for years and to hear the nightmare problems I always ask him why he stays with Sprint. He’s one of those “loyal” customers that corporations could care less about.As soon as his contract is up,he’s switching to Verizon…Another friend switched from Verizon to At&T ,for business reasons(to “save” money) and now he realizes he should have stayed with Verizon…C’est la vie….you linve you learn..Eventually…
As an employee, this “unified company” crap is just that. They are laying people off and offering voluntary and involuntary separation plans. Morale is at an all-time low and things could not be any different than the BS coprorate PR puts out about the “positive status” of our employees. This is the same ole song and dance we have been hearing for two years now…change is coming..yeah right! Next thing, they will fire another ad agency and start yet another branding campaign trying to find their true identity. Don’t believe the hype! Sprin is run very, very poorly and is not at all efficient or smart in how we are structured as a company…no matter what group or area your work is in. take it from an insider…”you have to read the book to get the entire story.” I have never, ever worked for a company as large as Sprint Nextel that is operated so poorly…you would be AMAZED if you knew the TRUTH!
i worked for both sprintnexel and att, its all about coverage and what clients you cater too. sprint doesnt have the cover att does in my area. also verizon isnt even a big player. verizon has worse coverage than sprint in this particular area
Many Sprint employees telecommute which might explain why John’s neighbor is at home half of the time (reduces traffic/saves gas & time). I regret that so many are so eager for Sprint’s demise - it would be a real blow to local economies in communities with a sizable Sprint employee population.
One major problem Sprint has is with it’s employees in Kansas. Half of them in Overland Park never report to work before 9am and leave work around 3pm. I have a neighbor who is home half the time. How can Sprint pay these employees and allow them to stay home?
Ya Tell me about it! (search “Hate Verizon Customer Service”)or any other company for that matter! Bad form attacking Sprint and acting like everyone else is perfect.
http://www.google.com/search?hl=en&q=Hate+Verizon+customer+service
Search bad customer service “verizon” or “AT&T” and you will see that there are blogs and websites dedicated to poor customer service industry wide. Sprint is getting a bad rap from the press.
Sprint could reverse its fortunes by taking a less myopic view of its business. Sprint only needs to do the following to dominate the industry:
1. Provide genuinely *GOOD* customer service.
2. Eliminate the shady business practices (like overbilling and hoping the user doesn’t notice)
3. Improve their wireless coverage. There are dead spots in the coverage in Overland Park! The site of their corporate headquarters and they can’t even provide good coverage to the entire city!.
Are you all serious. if any of you knew anything about the industry you would realize that ALL the wireless companies have bad customer service. its called a contract! Sprint is no worse. Everyone seems to forget how AT&T customers were treated when their merger happened with Cingular. And i still dont think that they got the bad press Sprint is now.
I was with nextel/sprint for about 5 years. My bills started to increasingly larger every month. I asked for detail billing to see why. I was getting charged for phone calls made across the country for hours at a time. I even had my phone shipped back to them for repair and still got charged. I called everymonth for 2 years only to be told “someone must be using your phone when you aren’t looking.” I was outraged and got a lawyer involved. Finally I was told they had added someone to my account by accident!!!! No apology. No reimbursement - nothing. I cancelled when my contract ended and they had the nerve to ask wy I was cancelling because my account had no reports of unhappy service.
I am now with verizon which has been an absolute pleasurable cellular experience. Now I know the true joy of customer service and hope that Sprint will suffer everday for the way they have treated their customers!!!
I’ve got a better one. I just bought a new phone and renewed my contract for 2 years. Sprint tried to charge me $18.00 to do this. I flat refused to pay it and they took it off. WHAT are they thinking? You DON’T charge a customer to stay with you. How stupid!
I am so happy that there are more people who have been deceived by Sprint. I bought a broadband card from them alerting them to the fact that I had an Apple computer. After many FRUSTRATING conversations with customer service and going to several Sprint stores in New York I was told I bought the wrong card. I told customer service that their store clerks assured me that I bought the correct card. Long story short they wanted to charge me $250 to switch out of the plan. And I have been a customer for 8 years. Can not wait until my contract is up.
Logically, Sprint would be the telecom concern most affected by the current credit crunch. They are the first telecom domino. Cingular should be next.
I was a Nextel customer for years and loved it, but EVERYONE from Nextel employees to customers got screwed when Sprint bought them. I hate Sprint and went to AT&T. The phone co should have never been split up, that’s when all this BS started…Sprint deserves to go out of business…..soon as opposed to later.
Sprint treats its customers like enemies, without the benefit of the Geneva accords.I’ve heard they send their staff to Guantanamo for training. The secret in dealing with them is that they have a separate unit called “customer care” which will actually try to assist you after their other staff has insulted you for half an hour. What a way of doing business!
I agree with Nick, what’s wrong with you guys. I’ve had Sprint for 10 years and have never had problem. Pay your bill and they treat you like a King. No other wireless company is as clear as Sprint.
It just goes to show how incomptence is so pervasive in the wireless industry. It is systemic. You have all these “former” telco morons whose background primariliy consist of working in a monoplized enviornment. They have ZERO retail acumen and have never had manage a “customer centric” model. I’m shocked that these companies continue to revert back to a leadership structure that’s so dated. Wireless in the US is a joke. If Sprint wants to turn things around, go raid some top retailers for executive talent and reinvent yourself. You are irrelevnat and that’s a scarry place to be.
I actually just moved to sprint from verizon. I was with verizon before they were verizon and customer service and cell service was going down hill. Rude, very un helpful, and service was getting worse not sure why maybe the number of people they had on a tower with out upgrading it. A while back I bought a sprint data card and it was GREAT! Speeds smok’n and faster then any one elses and no tower problems. Now we just got the Rumor great phone great price and great customer service. All research and discussions for my area suggested Verizon or Sprint because AT&T messed up the greatness of Cingular and t-moblie was just to expensive and bad phones. I can’t wait for the WiMax from Sprint in about a year. 7-8 meg data speeds SWEET!
I was a Sprint/Nextel commercial customer for 14 months (after being an individual client for 2 years on Sprint).
Invoices were horrendous, customer service was worse. Every time I tried to add a new line, it took a minimum of 7 phone calls and 30 - 45 minutes!
About the only positive was their coverage was pretty good for me - and their P2T service worked well.
Too late to save this company. They can’t afford to pull CS back from India to improve service levels.
The demise was the merger of 2 totally different companies that management couldn’t effectively integrate….
Too bad….
I was a nextel user for many years before changing to sprint (same company right?) with the poor customer service and inability to fix their own mistakes I have August of 09 circled on my calender as the month I am finally free of them. If I wouldn’t have to pay 5 early term. fees I would dump them now.
I am so SICK of Sprint and there lack of customer service. I have been a customer sent 2000 and you would think you would not have the same problems in 2008. I am so HAPPY to here this report and LOOK forward to more in the future.
I’ve had Sprint for years - The only problems I ever have are when they work on integrating their stuff with Nextel. Customer Service is just as good as other companies have been - but then I am always very polite with all customer support reps. you need to be creative and persistent with CS in general. Their leadership has not given the company what it needs - but they’ve enriched themselves and their bankers and lawyers instead. When will we ever get free of the modern bane - the ‘executive MBA’?
There service department is terrible and they know that but don’t care and that equals 29 billion in losses.
I left Sprint last month after years of issues with them. I always paid my bill on time but I move frequently. Everytime I moved and had to change numbers I got relocked into another contract and double billed. Because of the double billing it had my bill at nearly $350 and not paid and they cut me off without warning several times.
You reap what you sow and Sprint is a disaster. I hope the 29 billion loss causes some of the execs that thumbed their nose at us to lose positions.
ATT is fantastic!
I was a sprint customer.i left sprint two years ago cuz at&t was offered new phone.but at&t service is horrible.i want to go back sprint once my contract ends with at&t.
OK! OK! I dont understand where u guys are coming from…I have had Sprint for 3 years now.. and they are the best!! The customer service to me at least has been suberb! my friends always tell me their bad experiences but for some reason they treat me like gold! i have NEVER had a dropped call.. if i need some extra 100 minutes for the month i got it free! also if i was late on a bill they would give an extension to pay and 15% off loyalty discount. I DO NOT WORK FOR SPRINT or know anyone thats an employee. so i dont have a hookup from a buddy. but the only thing sprint needs to offer its customers is better phones!!! they are way behind in bringing hot new phones to their customers. maybe that would lure some new customers….
the best way for a cell phone company to always compete is to always have the newest and best phones.. right now sprint falls behind verizon and at&t in that category. shocking that they are losing clients to the competition…
I switched from sprint to Tmobile until my boss told me to switch to Verizon and you will be happy ever after. I do lot of business over the cell phone and frankly most people do not know if they are calling land line or cell.
I was a customer with Sprint for 10 years. I finally switched because I was tired of the rude service and was tired of being with a carrier that didn’t have sim cards. They called and asked me to come back. I asked them not to call me again because all the incentives they offered me to stay should have been offered earlier.
Every effort sprint has made to me to reward me for my customer loyalty over the previous 6 years or so included the use of strings attached that might as well be steel chains. My current contract with them ends in September, and I am counting down the days till I can ditch them completely.
I was a Sprint customer for 7 years. But as most people have noted, customer service was horrible and that is what made me leave them. Not to say I am happy with AT&T’s coverage, but their customer service is awesome.
I HATE Sprint! They have treated me like a third class citizen for years and I’m very tired of it. I’ve warned them many times that there attitudes would come back to bite them in the a– they never seemed to care. 683,000 lost contracts… Hahahaha… I guess that’s what it takes to wake some companies up. I hope they can manage to get it back together I’m still with them and with 6 lines for my small business.
How many times do CEO’s gamble - and lose - such huge amounts of money on buying half-baked assets.
In the meantime they warn of damnation if the minimum wage is raised a few dollars….
I’ve been a customer of sprint since ‘97.
I’ve put up with the sometimes spotty service.
I’ve put up with the longterm contracts.
I’ve put up with the overseas call centers.
Last year I took an offer for a free third line. What they didn’t tell me was that it meant they would be charging an extra $10 a month for the second line I already had.
As soon as my contract is up I am leaving and never coming back. I do not pay money to be deceived.
I had sprint a very long time ago, so i guess there must have been a big change. When i first used sprint, it was from ‘98 - ‘02. Customer service was never the problem. They were very helpful and even open to negotiation on plans. The only reason i left Sprint was because there was hardly no converage in when i went away to college. The only company that had coverage up there was VZW. I don’t understand these experiences with bad customer service. I guess it all happened after i left. (example, when they learned of the reason why i was leaving and they knew they had no coverage, they waived the early termination fee))
I have sprint and love them. AT&T was terrible in my metro area (Charlotte). Whenever I call I never have a problem getting to a ‘real’ person (albeit with an accent, but you can’t avoid that anywhere now).
Coverage is great, CS is good, and my phone is wonderful. Maybe they’ve shifted things lately.
Schadenfreude? Perhaps, but having once been, for years, an object of their contempt (read: I was once a Sprint customer) I can’t help but grin ear to ear upon hearing of their suffering. I hope they crash and burn completely.
How did they manage to lose this much money? Sounds like someone took a gamble in the sub-prime mortgage industry..No wait, it’s just crappy customer service that caused this mess..
I left Nextel/Sprint over a year ago and it was the best cell phone move I’ve made since I started using cell phones over 12 years ago. The customer service @ Sprint is TERRIBLE!! The cell service was always spotty and I can’t even count how many times I never had service. After buying a new phone and being forced to extend my contract, the phone stopped working within 2 months and Sprint would do nothing about it. I finally paid them there early termination fee just to get rid of them! THE worst customer service department I have ever delt with. Here’s the kicker - I was a customer for a long time and they couldn’t see the value in that. I am not surprised that they have lost billions!!
Sprint deserves to be in this hole. They can’t even provide the most simple task of keeping their customers happy. I was a former customer of Sprints due to their horrible service.
Even the call center reps in India can provide more courtesy then these clowns. I’m happy their customers are ditching them in groves.
Eventhough they have good products,they will not come back in to market unless they change the attitude in their cutomer service.The total post-paid subscribers declined by 683,000,the others on the way to get rid of this service.No company shouldn’t dare to tell the customers that we don’t want to give the service because you made too many customer service calls.
Sprint PCS(Poor Customer Service). Sprint is learning this lesson a bit late in the game. As a former Sprint user, Customer retention was never a focus…just new subscribers. Get a better network, competitive pricing, and try and hold onto existing customers. Pretty simple.
The bloggers have been telling Sprint what their problem is for the last year. Unfortunately, either there is no leadership at Sprint or no one is listening. The solution is easy–provide customer service–it currently doesn’t exist and management doesn’t seem to care.
I still don’t understand why Sprint abandoned their personal wireless marketing efforts in favor of business wireless service. For a while they were the only company whose network was on par with Verizon. I still think there’s a huge opportunity for them to compete with Verizon & AT&T on high-tech smartphone service for personal use. AT&T’s data plans are priced well but the network stinks; Verizon’s network is great but their plans stink.
sprints customer service and accounting systems are horrible I lft them 4 years ago and will never go back. I got an unexplained bill for 2000.00 and it took 2 months for them to tell me they did not know why I was billed 2000 extra. O and they canceled my phone because of the size of the bill which was an accounting error on their part. When they got their act together they offered me a 10 credit!!!!! only had my phone shut off for 2 months trying to get it turned backed on before I just went to Verizon..
I am Soooo HAPPY !! I hope they go Bankrupt and never come back again.
Customer experience??? Try bringing their call center back from Asia so instead of caling 8 times to get an English speaking person you only have to call once.
I was a loyal Sprint customer for three years till I got fed up of rude customer service. It felt like I was being interrogated each time and was told coverage problems were because my house was badly designed. I switched to Verizon and have had no problems with coverage since. I did expect Sprint to take a beating over their customer service but it looks like the Executive Leadership is still in denial.
Ha! Ha! Ha!
Finally, a feelgood story.
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My experience in working with Sprint on their original build out is that they are populated with a lot of very young, arrogant little jerks who know far less than they think they do. If most of them get layed off, no loss.