Sprint Corp. shares surged after it topped revenue and profit estimates for last quarter, potentially giving the cash-strapped carrier more breathing room as it waits for approval of a takeover by T-Mobile US.
Sprint, the smallest of the top four U.S. wireless carriers, lost phone subscribers for the first time in three years but gained 109,000 total monthly subscribers in its fiscal second quarter, largely thanks to tablets, network hot spots and smartwatches. Analysts had predicted a gain of 26,000 customers.
The upbeat results could placate investors awaiting a bailout from the $26.5 billion proposed merger with T-Mobile.
The question is how antitrust enforcers will perceive the results. The T-Mobile deal would shrink the mobile market to three companies — and merge the most aggressive competitors. So Sprint’s subscriber figures are under scrutiny.
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A lack of highly vocal opposition to the deal has been seen as a sign that approval is possible. The companies have argued that the combination would help speed 5G expansion. And wireless service from cable giants Comcast and Charter Communications gives regulators some new mobile competition to point to.
Sprint shares rose as much as 12 percent to $6.36 in New York trading following the results. The stock had fallen 3.6 percent this year, compared with a 6.5 percent drop for the Russell 1000 telecom index. T-Mobile was up as much as 8.9 percent Wednesday in New York.