Overland Park Sprint Corp. on Tuesday reported strong sales in its third quarter but took a loss as it wrote off $3.5 billion in value for its long-distance assets and suffered from disruptions caused by hurricanes.
The Overland Park-based telecommunications giant reported a loss of $1.9 billion, or $1.32 a share, for the July-September period in contrast to a loss of $497 million, or 35 cents a share, during the same period last year.
Sprint announced last week that it was moving away from stand-alone long distance service and would instead provide it only in package deals with local, wireless and Internet services.
The company said it would lay off 700 workers and write down the value of its long-distance assets.
On Tuesday, the company said that write-down would be $3.5 billion.
"The long-distance business isn't what it used to be, and we have to maximize the value of these assets," Howard Janzen, president of Sprint's business solutions division, told analysts Tuesday.
Revenues for the quarter rose 3.1 percent to $6.9 billion from $6.7 billion in the year-ago quarter.
Excluding the write-down of the long-distance assets, as well as restructuring charges, Sprint said it earned 24 cents per share, compared to 19 cents per share a year ago. Analysts surveyed by Thomson First Call had expected earnings of 21 cents per share before charges on $6.9 billion in revenue.
Sprint also raised its outlook for the year on Tuesday and now expects annual earnings per share of between 84 and 86 cents, up from an earlier estimate of 74 to 78 cents. That doesn't include an expected bonus of 8 cents per share in the fourth quarter to reflect the smaller tax depreciation adjustment on the long-distance assets.