Sprint Earnings: What to Watch

Sprint is scheduled to announce its fiscal-second quarter earnings after the market closes Monday. Here's what to keep an eye on:

EARNINGS FORECAST: Analysts are expecting a loss of 6 cents a share, according to Thomson Reuters.

REVENUE FORECAST: Analysts are expecting revenue of $8.6 billion, according to Thomson Reuters.

SUBSCRIBER GROWTH (OR LACK THEREOF): Sprint has been losing customers for several years. When Marcelo Claure was appointed CEO in August he said his number-one mission was to turn that around. In his first days on the job, Mr. Claure slashed prices and introduced sharable data buckets that were larger than rivals. Mr. Claure said at a conference in September that the moves resulted in "a couple days that we have more customers coming to us than leaving us." Whether the carrier can sustain that for an entire quarter is the big question. Its competitors have responded with promotions of their own, and each has so far reported strong subscriber growth this quarter. With such strong results coming from rivals, it isn't looking good for Sprint. If numbers are strong, we'll take a close look at how many of those additions are coming from less lucrative tablet sales, which carriers have been heavily promoting.

NETWORK: Sprint has been undergoing a major overhaul of its phone network for the past few years and is largely finished with updates to the basic phone layer. Now it is turning its attention to building out high speed data connections using wireless airwaves at the 2.5 gigahertz frequency. Sprint had previously said it would widely deploy 2.5 gigahertz airwaves across the country, but Mr. Claure has indicated a desire to scale that back. Instead, he wants to use the airwaves to build a very robust network in only a few cities. We'll be listening for updates on this strategy.

REORGANIZATION: Sprint announced Friday the appointment of Junichi Miyakawa to a newly created position of Technical Chief Operating Officer. Mr. Miyakawa is a board member and top executive at SoftBank Corp., which bought Sprint last year. Mr. Miyakawa is known for his expertise on using the 2.5 gigahertz airwaves, and his arrival shows SoftBank's increasing desire to remake Sprint. Meanwhile, the carrier has announced hundreds of layoffs. Any insight into continued restructuring under the company's new CEO will be notable.

PROFITABILITY: Sprint had a rare, $23 million profit last quarter. Whether it can repeat that feat this quarter is a big question, especially given the fact it has been cutting prices amid growing competition.

IPHONE LEASING: While most of the industry, including Sprint, has been shifting toward cellphone plans where customers pay full price for their devices in installments over time, Sprint has introduced a new wrinkle: phone leasing. The model is more akin to two-year service contracts of old, as customers get a discount on the monthly device bill but they don't get to own the device. Sprint touted this as an innovative offer customers would love. We should find out whether that's the case during Monday's call.

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