No. 3 U.S. long-distance telephone company Sprint Corp. today said its first-quarter net income fell 72 percent amid lower calling prices, stiff competition and investments to build its data and wireless businesses.
Kansas City, Mo.-based Sprint’s net income dropped to $315 million, or 36 cents a share, compared with $1.118 billion, or $1.25 a share a year ago.
Income from continuing operations was $316 million, or 36 cents a share, including a gain of 1 cent a share from investing activities. That compared with $445 million, or 50 cents a share, a year ago.
Wall Street analysts had expected Sprint to post earnings in the range of 36 cents a share to 39 cents a share, with an average estimate of 37 cents a share, according to research firm Thomson Financial/First Call.
Sprint warned in February that its 2001 earnings would be at the low end of previous forecasts. Sprint and its major long-distance rivals have suffered as calling prices have fallen sharply to pennies a minute and the Baby Bells began to enter the long-distance market.
Traditional carriers are building wireless, data and Internet businesses to jump-start growth, but start-up costs continue to weigh on results.
“We have shifted our focus and our resources from a predominantly wireline voice business to higher-growth areas of data, wireless and broadband services where we expect to see significant dividends in the years to come,” Sprint Chairman William Esrey said in a statement. The company is hosting its annual shareholder meeting on Tuesday.
Its operating revenues were $4.358 billion, down from $4.404 billion a year ago, and slightly below Wall Street expectations of $4.397 billion, according to First Call. Revenues in Sprint’s local telecommunications unit rose 4 percent to $1.55 billion.