SAN FRANCISCO -- Not to worry, RadioShack (RSH) CEO Leonard Roberts assured potential investors attending his presentation at the Banc of America Securities Investment Conference here Thursday: that nasty Sprint PCS (PCS) news won't hurt a bit.
The digital wireless provider said Wednesday that it expects to add 800,000 new customers in the third quarter, not the 900,000 previously estimated. It predicted its third-quarter churn rate (the percentage of customers lost) would be in the high 2% to 3% range, higher than expected, as some customers failed to renew and others were cut off for not paying their bills. Sprint PCS shares have dropped 30% since the announcement. And RadioShack, which sells Sprint wireless services through its stores, saw its own shares fall $3.38 Wednesday before recovering most of that ground Thursday to close at $64.81.
Roberts said RadioShack has a more conservative assumption of a 3.25% churn rate built into its own sales projections for Sprint services. And the company still expects to grow its overall annual sales by 20% and earnings per share by 22% or 23% for the foreseeable future, Roberts said.
RadioShack, which is pitching itself as the ultimate play on the digital product cycle, has forged a number of alliances with companies including
to sell products and services through its stores. It expects to announce a cable partner before the end of the year, said Roberts.
Not that anyone needed one, but the latest sign that the Internet marketers have sunk to new lows was in not-so-full view at the B of A conference. In the luxe
ladies' room just adjacent to the main presentation area, visitors to the first stall on the left found themselves eye-level with a roll of toilet paper printed with
logos. The company is promoting its site, which suggests and sells gifts, and obviously is trying to wipe out the competition.