Clearwire Equity Tanks on Sprint News

By

Clearwire’s stock fell 32 percent to $1.39 Oct. 7, 2011 following an announcement by Sprint that it was launching its own LTE network, on its own spectrum, without the help of Clearwire. Sprint furthermore said it will not sell any more WiMAX devices past 2012.

That’s a problem for a company that had counted on Sprint as its largest wholesale customer.

Sprint shares also fell about 10 percent to close at $2.71, though shares had been down to $2.48 intraday. Some investors might have been spooked by borrowing Sprint might have to do, or the refusal to provide guidance relating to the next several quarters. Clearwire stock falls 32 percent

But investors might also have been digesting the earlier news that Sprint has committed to buy at least 30.5 million iPhones, even though it would likely lose money on the deal until 2014, according to the Wall Street Journal.

The deal could represent a commitment of $20 billion at current rates, and Sprint has to buy the devices, whether or not it can sell them. Apple "Owns" Sprint

Apple was paid $632, on average, for each iPhone sold to mobile service providers in its most recent quarter, according to Credit Suisse.

 

The rapid LTE build, plus the Apple commitments, mean Sprint might have a tough time showing profit until 2014, even if sells all those 30.5 million iPhones.
Gary Kim is a contributing editor for TechZone360. To read more of Gary’s articles, please visit his columnist page.

Edited by Rich Steeves
Get stories like this delivered straight to your inbox. [Free eNews Subscription]

Contributing Editor

SHARE THIS ARTICLE
Related Articles

Can Science Outsmart Deepfake Deceivers? Klick Labs Proposes an Emerging Solution

By: Alex Passett    3/25/2024

Researchers at Klick Labs were able to identify audio deepfakes from authentic audio recordings via new vocal biomarker technology (alongside AI model…

Read More

Top 5 Best Ways to Integrate Technology for Successful Project-Based Learning

By: Contributing Writer    3/19/2024

Project-based learning, also popularly known as the PBL curriculum, emphasizes using and integrating technology with classroom teaching. This approach…

Read More

How to Protect Your Website From LDAP Injection Attacks

By: Contributing Writer    3/12/2024

Prevent LDAP injection attacks with regular testing, limiting access privileges, sanitizing user input, and applying the proper encoding functions.

Read More

Azure Cost Optimization: 5 Things You Can Do to Save on Azure

By: Contributing Writer    3/7/2024

Azure cost optimization is the process of managing and reducing the overall cost of using Azure. It involves understanding the resources you're using,…

Read More

Massive Meta Apps and Services Outage Impacts Users Worldwide

By: Alex Passett    3/5/2024

Meta's suite of apps and services are experiencing major global outages on Super Tuesday 2024.

Read More