After Charter rebuffed an overture over the weekend that would essentially have the No. 2 cable company buy SoftBank's No. 4 US wireless carrier, Sprint, Bloomberg said that Son will try to buy Charter outright and combine it with Sprint.
The telecom giant, controlled by Japan's SoftBank, reported a net income of $206 million, or 5 cents per share, compared to a loss of $302 million, or 8 cents per share, in 2016. The company has been exploring deal options with T-Mobile US Inc but faces the hurdle of reaching an agreement on price as well as getting the deal approved by regulators.
Major cost cutting efforts and some compelling promotions, including offering a year of free service, helped Sprint on Tuesday report its first quarterly profit in three years. "And that deal is going to benefit most of Sprint shareholders". Postpaid phone gross additions also grew for the sixth consecutive quarter and were the highest first-quarter result in five years. The corporation added 88,000 new contract subscribers this quarter.
The company noted that the quarterly profit was a result of thousands of job cuts previous year, which cut $4 billion from operating costs.More news: Human embryo edited for first time in U.S. , pushes limits
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Sprint blamed the postpaid losses mainly on the tablet segment. "Hopefully, after a two-month hiatus during which Sprint has been in discussions with cable, the two sides can settle differences and secure the deal that would clearly bring the most value to both companies", analyst Jonathan Chaplin of New Street Research noted on Tuesday.
"We observed last quarter that we've never in our careers encountered a company whose financial reports, on an as-reported basis, make it as hard to discern underlying trends (although, to be fair, the entire wireless sector is problematic on this score)", Craig Moffett of MoffettNathanson wrote in a note to investors.
On the company's post-earnings conference call, Claure said that while Sprint could sustain itself, the synergies that could come with a transaction were significantly better than remaining a standalone entity. "Unfortunately, it is precisely these distortions that make M&A so hard".
While seemingly everyone in the world is waiting for Sprint CEO Marcello Claure to make a deal, the boss is still also focused on fixing the wireless carrier's own business. "The problem is simply Sprint's excessive valuation".