Leap Wireless International posts wider 3rd-quarter loss as subscriber growth slows

Associated Press

Last update: November 5, 2009 - 7:21 PM

SAN DIEGO - Leap Wireless International Inc. said Thursday its third-quarter loss grew 31 percent as competition and the weak economy were a drag on subscriber growth.

The company, which sells prepaid wireless service to consumers, said it lost $64.6 million, or 85 cents per share, in the three-month period, compared with a loss of $49.3 million, or 72 cents per share, in the year-ago quarter.

There were 11 percent more shares outstanding in the recent quarter, which diluted per-share results.

Revenue rose 21 percent to $599.5 million, from $496.7 million last year.

Analysts polled by Thomson Reuters, on average, were expecting a smaller loss of 53 cents per share on higher revenue of $620.2 million.

During the quarter, Leap added approximately 116,000 customers, down 25 percent from a year ago. Churn, or customer turnover, shot up to 5.4 percent from 4.2 percent in the same quarter last year, typically the company's weakest.

Average revenue per customer, an important measure in the industry, dropped 8 percent to $39.60 in the latest quarter, from $42.95 last year.

Looking ahead, Leap lowered its outlook for fiscal 2009 net customer additions to a range of 1.05 million to 1.3 million, including voice and broadband additions in its existing and expansion markets. Previously, Leap had estimated 1.5 million.

Leap shares closed Thursday's regular session down 90 cents, or 6.5 percent, at $13.03.

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