Sprint Writes Down Nextel, Posts $29.5 Billion Loss

Sprint LogoIf you thought eBay taking a hefty writedown for its mistake — I mean Skype was shocking — then Sprint’s Nextel deal writedown is going to leave you awed. Sprint Nextel reported a $29.5 billion loss, scratched its dividend and lost 683,000 customers. The company wrote down $29.7 billion of the $36 billion it paid for Nextel in 2005.

Taking that out of the equation, the company made some money, but things aren’t all that great for Sprint. Bloomberg reports that it is the fifth-largest loss among S&P 500 companies since 1990. In other words, there have been four other disasters bigger than this.

Anyway, there is more bad news in the offering, and new CEO Dan Hesse didn’t sugarcoat anything. With 1.2 million subscribers expected to switch away from Sprint, Hesse admitted that things are going to be tough.

“The fourth-quarter financial results reflect the challenges facing our wireless business… more difficult than what I had expected to encounter…will take time to produce improved operating performance. Our near-term subscriber and financial results will continue to be pressured.” [The Washington Post]

Hesse said Sprint will be the new brand, and they will launch the QChat in the second quarter.

That said, I wonder if Sprint can be saved? Take our poll and have your say.


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