Nextel affirms strong third-quarter guidance

Nextel Communications’ CEO Tim Donahue said his company is on track to post third-quarter results that will meet or exceed Nextel’s previous guidance for 2002.

Donahue told attendees of a Morgan Stanley investor conference that it should add about 2 million net subscribers and generate more than $3 billion in operating cash flow.

“Robust demand for our differentiated services combined with our industry-leading customer retention rates are driving Nextel’s success in the marketplace,” said Donahue in a press statement.

Likewise, Nextel Partners, an affiliate of Nextel, was firm with its previous guidance for the third quarter, saying Nextel Partners is on track to add 91,000 customers in the third quarter and 358,000 for the year. Nextel Partners also reiterated service revenue expectations of $165 million for the quarter and $633 million for the year.

Legg Mason reiterated its “Buy” rating of both companies. “We continue to believe that Nextel Communications and Nextel Partners have the only business models in the wireless industry that are working right now, with a consistent mix of subscriber and cash-flow growth,” the firm said in a research note today.