Sprint Loss Widens, but Fewer Subscribers Flee

NEW YORK (Reuters) - Sprint Nextel Corp reported a wider quarterly loss and a 9 percent revenue decline, but its success in slowing the loss of the most valuable wireless subscribers took some of the sting out of the results.

At the heart of Sprint's struggles is the loss of postpaid monthly-bill-paying subscribers, the most attractive ones in the mobile business, which has put it further behind rivals Verizon Wireless and AT&T Inc in the wireless wars.

In the third quarter, Sprint, the No. 3 U.S. mobile service, lost 801,000 postpaid subscribers, a significant number but well below the 870,000 losses analysts had feared.

"They still have an extremely long way to turn around the business and generate positive post-paid subscriber growth," said Soleil/Nelson Alpha Research analyst Michael Nelson. "Clearly, a loss of 800,000 a quarter isn't going to cut it, but it does show some sign of improvement and says they are at least heading in the right direction."

Shares of Sprint were down 2 cents at $3.22 on the New York Stock Exchange.

Helped by the introduction of Palm Inc's high-profile Pre smartphone, which has proven popular with customers, the subscriber losses slowed from 991,000 in the second quarter and 1.25 million in the first quarter.

Sprint Chief Executive Dan Hesse called the sequential improvement the best in more than five years, and said he expected a smaller postpaid subscriber loss again in the fourth quarter. Hesse said he expected the company to continue its momentum in improving subscriber trends in 2010.

The results are a far cry from the numbers put out by AT&T and Verizon Wireless, a venture of Verizon Communications and Vodafone Group Plc . Between them, AT&T and Verizon Wireless added more than 3 million subscribers in the third quarter.

Still, the improvement in the postpaid business offset depressed quarterly financial results, analysts said.