Top message: Goodbye, Nextel... by Amarantamin
Replying to: Not Profitable? by jrfdsf
Re: Not Profitable?
Which is exactly correct and to which I would add:
Nextel had even higher "ARPE" average revenue per EMPLOYEE than any other US wireless provider. In 2004 Nextel generated gross revenue of $13.4 billion with approx 19,000 employees, while Sprint Wireless generated gross revenue of $14.6 billion with approx 30,000 employees. Thus in 2004 Nextel grossed 44% more per employee compared to Sprint (using Sprint's numbers as the baseline). Put another way, (using Nextel's numbers as the baseline), Sprint was 31% less efficient than Nextel was.
In a nutshell, Nextel had less than 2/3 the number of customers as Sprint, less than 2/3 the number of employees, yet NEXTEL GENERATED TWICE THE PROFIT of Sprint, on 8% less gross income, with less than half the customer churn (Nextel was at 1.2% churn, Sprint was at 2.6% churn). No matter how you choose to do the math, Nextel's performance was SIGNIFICANTLY better than Sprint's was on all fronts, pre-merger.
In case anyone tries to flap their gums again and say that Nextel wasn't profitable, here are the actual numbers, quoting 2004 annual reports by both companies:
Wireless division customers:
Nextel = 16 million
Sprint = 25 million
Wireless division gross revenues:
Nextel = $13.4 billion
Sprint = 14.6 billion
Nextel = $3.0 billion
Sprint = $1.5 billion
Nextel = 19,000
Sprint = 30,000 (60,000 incl wireline)
As incontrovertible proof, here are the links to each company's annual reports:
http://phx.corporate-ir.net/phoenix.zhtml?c=63347&p= ... »
http://investors.sprint.com/phoenix.zhtml?c=127149&p ... »
- Well darn... by Amarantamin