Defunct RadioShack is not dead; it is only sleeping. In among the remarkably complex set of numbers Sprint Corp. (NYSE: S) issues with its quarterly earnings was a description of its plan to add stores using RadioShack locations.
According to Sprint management:
Sprint-RadioShack Stores — All 1,435 co-branded stores are open and staffed with Sprint employees. The fully operational “store-within-a-store” retail model has been completed in about one quarter of the locations with the remaining expected to be complete by the end of calendar year 2015.
Sprint has suffered from a retail distribution network with a store count that is much smaller than those of AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ), which also dominate it in customer count. And each T-Mobile US Inc. (NYSE: TMUS) retail location added another blow to Sprint now that the company controlled by Deutsche Telekom has passed it to become the number three wireless company in the United States by subscriber count.
It will take a long time to determine whether the locations Sprint picked will help its prospects. As a matter of fact, since Sprint does not break out the results of its stores, investors may never know. The plan, management says, is part of the long-term resurrection of Sprint, which based on its quarterly results is hardly a resurrection at all:
Net operating revenues of $8 billion decreased nine percent year-over-year, as customer shifts to rate plans associated with device financing options and postpaid phone customer losses drove lower wireless service revenues, and equipment revenues were impacted due to a shift from installment billing sales, which recognize more revenue at the point of sale, to leasing sales, which recognize revenues over time.
Also:
Net loss of $20 million, or loss per share of $.01, compared to a net income of $23 million, or earnings per share of $.01, in the year-ago period primarily due to higher interest expenses.
Odd numbers for a company that says it is doing better. Maybe the RadioShack stores will help.
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