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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Leap Wireless International, Inc. (MM) | NASDAQ:LEAP | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 17.65 | 0 | 01:00:00 |
By John Kell
Leap Wireless International Inc.'s (LEAP) second-quarter loss sharply widened as the pay-as-you-go wireless provider recorded a steep loss tied to a debt payment and lower revenue as the number of subscribers declined.
The company added 283,066 gross customers, compared with 492,720 additions a year earlier. Leap ended the quarter with 4.8 million subscribers, 18% lower than a year ago. Churn, a gauge of customer turnover, inched down to 4.3% from 4.4%.
Last month, Leap agreed to be acquired by larger peer AT&T Inc. (T) for about $1.2 billion in cash, a move aimed to shore up the larger company's access to the airwaves it needs to offer mobile service. The deal, expected to receive close scrutiny from regulators, is expected to close in the next several months.
Leap, which offers cellphone service under its Cricket brand, had embarked on a major business overall to attract higher-income customers with pricier smartphones. But the company has been hit hard by high unemployment that has hurt the company's traditionally lower-income customer base. Leap has only reported one quarterly profit since 2007, in the third quarter of 2012 when results benefited from a large gain on the exchange of spectrum licenses.
In the latest quarter, Leap reported a loss of $163.1 million, or $2.09 a share, compared with a prior-year loss of $41.6 million, or 54 cents a share. The latest results included a $73 million loss on early extinguishment of debt.
Total revenue fell 7% to $731.5 million.
Analysts surveyed by Thomson Reuters expected a loss of $1.07 on $735 million in revenue.
The company swung to an operating loss of $7.6 million, compared to a prior-year operating profit of $31.6 million.
Average revenue per user increased 7.8%.
Core wireless gross customer additions fell 34% to 239,514. Core wireless churn grew to 3.6% from 3.3%.
Shares, inactive in after-hours trading, closed the regular session down five cents to $16.63.
Write to John Kell at john.kell@wsj.com
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