Nextel loss widens, but revenues and subscribers grow

Despite taking a $359 million loss for second quarter 2001, Nextel managed to pull off some impressive operational growth, increasing its revenue 38 percent and adding more than 658,000 global subscribers.

The wireless carrier posted revenues of $1.88 billion, up from $1.37 billion in the second quarter of last year. Nextel also added 485,900 domestic subscribers and 150,900 international subscribers this quarter, increasing its total global subscriber base 8% to 8.95 million customers.

Though the company surged forward operationally, its bottom line fell still lower. It’s $359 million loss, or 47 cents per share, increased 23 percent from the $292 million, or 38 cents per share, it posted in the same period last year. In addition, Nextel’s adjusted results do not include one-time charges of $22 million for restructuring expenses and $45 million for loses related to foreign currency transactions. Those items bring Nextel’s losses to $426 million, or 56 cents per share.

Nextel officials also said that operating cash flows had increased by 50%, from $323 million to $483 million year to year. The company cut its capital expenditures by 4% in the quarter and decreased its operational expenses, yet still maintains the highest average monthly revenue per customer in the industry at $72 per user, it said.

“The belt-tightening activities of many companies have affected the subscriber growth, and the macroeconomic climate continues to be a challenging one,” Nextel CEO and president Tim Donahue said. “But Nextel is continuing to grow our subscriber base by offering a productivity enhancing communications tool that nobody else can match.”

Donahue added that Nextel has 1.5 million wireless data subscribers—about 19%—of its customer base, and continues to lure more and more customers over to messaging and Internet services.