While domestic subscriber growth was slightly better than anticipated, the company incurred slightly higher customer acquisition and handset upgrade costs in the first quarter of 2001, chief financial officer John Brittain explained in a news release.
Nextel, had already warned in April, as most tech companies did, that the slowing economy would hurt first-quarter results.
The company added that it was taking other cost-saving measures including lowering subsidies on mobile phones, cutting distribution costs and implementing better-targeted sales efforts.
Nextel said it added a net 695,400 new global subscribers in the quarter, for a total of 8.33 million subscribers. Domestic subscribers grew by 520,300 during the quarter and international subscribers grew by 155,200.
Earnings before interest, taxes, depreciation and amortization, a key measure for the telecommunications industry, rose 39% to $318 million from $228 million a year ago.
Operating revenues rose 48% to $1.74 billion from $1.18 billion a year ago.
Our global subscriber growth for the quarter is one of the largest increases in our history and domestic operations finished slightly stronger than we anticipated, reflecting Nextel’s increased market share, Nextel president and chief executive Tim Donahue said. We are implementing a number of initiatives designed to drive even greater operating cash flow profitability, he added.
