Sprint Falls, PCS Rises on Q4 Results

Sprint Corp. (NYSE: FON) fell to US$24.23, dropping 57 cents in early trading Thursday, while its Sprint PCS division rose 63 cents to $31.13, after the companies released fourth-quarter results.

Sprint, a Kansas City, Missouri-based long-distance telephone company, said revenue for the fourth quarter ended December 31st was $4.39 billion, down from $4.42 billion in the year-earlier quarter. Operating income fell to $598 million from $731 million.

Income from continuing operations fell 14 percent from a year earlier to $359 million. However, Sprint chairman and chief executive officer William Esrey said he remains "optimistic" about the company's future growth.

"It is clear that the telecommunications industry is undergoing a significant transformation," Esrey said.

According to Esrey, the transformation is "a shift from voice to data, from calling minutes to bits and bytes, from wireline to wireless."

The company plans to transition its revenue mix, that is now predominantly wireline voice, to the higher growth areas of data, wireless and local broadband services, Esrey said.

The PCS mobile communications group, meanwhile, said it added almost 1.25 million new subscribers during the quarter, for a 19 percent increase in subscriber growth over the 1999 fourth quarter. The company said it ended 2000 with more than 9.85 million subscribers.

Revenue at Sprint PCS rose 84 percent from a year earlier to $1.94 billion, with earnings before income taxes, depreciation and amortization of $21 million, versus a loss of $501 million.

"The continued growth of Sprint PCS this year represents another chapter in an impressive business success story," said Esrey. The company, he said, is "positioned well to migrate cost-effectively to the next generation of wireless services."

Sprint PCS's network now covers almost 80 percent of the United States. The company's products and services are sold in more than 13,500 locations.

PCS is further extending its wireless reach through an agreement with America Online that brings AOL's Instant Messenger service to Sprint PCS Internet-ready phones. The phones also come with free e-mail and other services.