Earnings: Virgin Mobile Profit Jumps On Popularity Of New Calling Plans


image Virgin Mobile USA (NYSE: VM) posted a first quarter net income of $19.1 million, or 19 cents a share, a surge of 301 percent from its earnings of $4.7 million a year earlier, as the MVNO


Don Shula

This is some crappy numbers if I have to say. Yes, they have positive outlook, but they still have no answer for Boost. They have $50 unlimited everything and Virgin has $50 unlimited talk. All the high value high data users are flocking to Boost. I don't know what their answer is for Boost. Boost is also adding a full QWERTY keyboard (i465 -Boost Mobile Shuttle) which will compete head on with the X-TC phone and will cause huge disruptions in Virgin's texting business.

Virgin Mobile still suffers from lack of distribution, Boost is opening 50 new Boost exclusive stores, while Virgin has now shut down their exclusive mall program with Celluphone. If they are to improve numbers they will need to add more third party distribution to survive.


This is all well and good… but the future looks pretty bleak. The numbers than nobody seems to pay attention to are the following:
-Net additions… (-133K). They lost over 100K subs last quarter and the real hammer will fall this quarter when the holiday gross additions will fall off (remember they count subs active for 150 days after their last top-up)
-Operating cost (down approx 50%) – All projects on hold, no capital expenditures, means future prod/svc are non-existent.

They reported solid numbers no doubt… but they are still coasting from past success… the fuel for growth for VM is running out.


also rolled out two other plans, "Texter's Delight" and "Pink Slip … Virgin Mobile USA CEO Dan Schulman said in statement,Virgin Mobile USA (NYSE: VM) posted a first quarter net income of $19.1 million, or 19 cents a share

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