Updates stock informationOVERLAND PARK, Kan. ( TheStreet) -- Sprint Nextel ( S) suffered a widening loss in its second-quarter results, highlighting the challenges facing the firm. The wireless provider posted a second-quarter loss of $384 million, or 13 cents a share, compared to a loss of $344 million, or 12 cents a share, in the prior year's quarter. These earnings figures are diluted, however, and Sprint did not post adjusted numbers for the second quarter. Analysts surveyed by Thomson Reuters had expected the firm to post a loss of 2 cents a share on an adjusted basis. Sprint, which competes with AT&T ( T) and Verizon ( VZ), reported second-quarter revenue of $8.1 billion, down 10% on the same period last year, but in line with Wall Street's forecast of $8.12 billion. Investors were underwhelmed by Sprint's results, and the company's shares fell 12% to $4.04 in recent trading. As in previous quarters, wireless proved to be problematic for the telecom giant. Sprint lost 257,000 wireless customers during the quarter, although Dan Hesse, the Sprint CEO, said that the company is heading in the right direction. "In the second quarter, we made further progress on our efforts to enhance financial stability, improve the customer experience and reinvigorate the brand," he said, in a statement. "The widespread visibility surrounding our record-breaking June launch of the Palm ( PALM) Pre handset gave us an unprecedented opportunity to showcase these improvements to customers as 'a new Sprint'." Sprint is clearly looking to woo customers with the latest smartphones, and began offering Research In Motion's ( RIMM) Blackberry Tour device earlier this month. "Postpaid subscriber trends need to improve," said Hesse during a conference call early Wednesday, adding that "third-party" deals with the likes of Radioshack ( RSH) and Best Buy ( BBY) will help the company achieve this.
Hesse explained that Sprint also generated free cash flow of almost $1.5 billion in the first half of 2009, and exited the second quarter with $4.6 billion in cash and equivalents. "We now have more than enough cash-in-hand to pay our scheduled maturities through the end of 2011," he said. The Overland Park, Kan.-based firm announced plans to acquire Virgin Mobile USA ( VM) earlier this week, increasing its subprime as wireless runs out of growing room. Sprint, which lost 1 million subscribers last year, and continues to lose thousands every month, has embraced prepaid with mixed results, but is now looking for a boost from Virgin Mobile. "This acquisition will strengthen our position in the prepaid market, giving us two great brands
and more operational efficiency," said Hesse during Wednesday's conference call. -- Reported by James Rogers in New York