Oct 30 (Reuters) - Sprint Corp posted a decline inthird-quarter revenue on Wednesday as it lost more subscribersthan expected following the shutdown of its older iDen networkand warned that customer defections would remain high in comingquarters.
But investors shrugged off the weak results, pushing upSprint shares by 1.8 percent in premarket trade as the companymaintained its financial targets for full-year 2013 and focusedon improvements it promised for 2014.
Sprint, the No. 3 U.S. mobile operator which is 80 percentowned by SoftBank Corp, reported net subscriber lossesof 360,000 for the quarter. Six analysts contacted by Reutersexpected losses of roughly 313,000, on average.
By comparison, Sprint's biggest rival, Verizon Wireless added 927,000 subscribers in the quarter, and No.2 U.S. mobile provider AT&T Inc added 363,000. Smallerrival T-Mobile US Inc is due to report results Nov. 5.
Sprint said it suffered from service problems in the quarterdue to a massive network overhaul as well as the expected lossof corporate customers due to the June shutdown of its iDennetwork, which was used mostly by business customers.
Chief Executive Dan Hesse told analysts on a conference callthat customer defections would continue to be at high levelsinto the middle of 2014, when the company expects to completethe bulk of the network overhaul.
Sprint is working on increasing data service speeds on itsnetwork and adding capacity from spectrum previously used by theiDen network as well as spectrum from Clearwire Corp, whichSprint bought out in July.
"We're finally turning the corner on this massive projectand seeing a light at the end of the tunnel," Hesse said.
Roe Equity Research analyst Kevin Roe said Sprint's resultswere mostly in line with his low expectations.
"This is a very challenging transition period for Sprint andso the focus is on 2014," Roe said.
Investors hope Sprint will compete better with the help ofthe network upgrade and with financial backing from Japan'sSoftbank, which bought a controlling stake in Sprint for $21.6billion in July.
One expectation is that Sprint will eventually be able tomassively boost its network capacity after its Clearwiretakeover, which brought it vast amounts of wireless airwaves.
Sprint reported a third-quarter profit of $383 million,compared with a loss of $767 million in the year-ago period,before its SoftBank and Clearwire deals.
The company said the latest quarter was helped by aone-time, non-cash, $1.4 billion gain, net of taxes, related toits previously held investment in Clearwire.
Revenue fell to $8.68 billion from $8.76 billion.
Sprint still expects 2013 adjusted earnings before interest,taxes, depreciation and amortization of between $5.1 billion and$5.3 billion, including the dilutive effects of the SoftBank andClearwire transactions. It also stuck by its target of 2013capital expenditures of about $8 billion.
Sprint shares rose to $6.80 premarket after closing at $6.68in the previous New York Stock Exchange session.
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