swung to a profit in the first quarter on 21% revenue growth and said it added a better-than-expected 480,000 new customers in the quarter.
The earnings news lifted Nextel Class A shares 7% to $13.95 in the Instinet premarket.
The Reston, Va.-based wireless carrier earned $240 million, or 20 cents a share after preferred dividends, compared with a loss of $591 million, or 82 cents a share, in the same period last year. Analysts were expecting earnings of 16 cents a share in the latest quarter.
Total sales were up 21% to $2.4 billion during the quarter, which ended March 31. Average monthly revenue per subscriber was $67, the company said. Nextel also said the 480,000 new subscribers brought total subscribers to 11.1 million.
"Strong customer demand for Nextel's differentiated wireless services coupled with our focused growth strategies led to improved subscriber quality and our fourth consecutive quarter of positive earnings," said Tim Donahue, Nextel's chief executive. The company also said it rolled out software during the quarter that will enable Nextel to nearly double the cellular calling capacity of its wireless network.
Looking ahead, the company said it is "solidly on track to meet or exceed" its goals for 2003. The company had said in February that it expects 2003 earnings of at least 75 cents a share. Analysts expect the company to earn 82 cents a share for full-year 2003; the company lost 5 cents a share in 2002.
Nextel said it retired $568 million of debt and mandatorily redeemable preferred stock in the quarter for $570 million cash. Over the last year, Nextel has retired about $3.8 billion of debt and preferred stock.