Clearwire Profits Beat Expectations

Clearwire Corp. (NASDAQ:CLWR) on Thursday announced the its second quarter financial results and subscriber growth estimates that beat analyst estimates.

The financial reports eased investor concerns about the future of the wireless network service provider. The shares of the company rose by more than 31 percent after the announcement of the quarterly results.

According to the statement released by Clearwire Corp, the wholesale network provider expects to add another 1.9 million new subscribers to its wholesale network services for the next quarter, up from the 1.5 million new subscribers that were estimated by analysts.

Sprint Nextel Corp. is the majority owner of Clearwire and the network provider depends largely on the subscriber growth on Sprint for increase in subscriber base. The service provides high speed network for smartphones and tablets. The stocks of the company fell last week after Sprint said that it was beginning to set up its own 4G network and would also stop selling phones that use Clearwire’s network by the end of next year.

Clearwire has reported that it needs around $1 billion in new capital to fund its operations and in order to upgrade its network. The company’s cash and equivalents currently stand at $700 million, lower from the last year’s estimates of $848 million.

The future of the partner between Sprint and Clearwire is still uncertain and the network provider did not assure that United States’ third largest mobile phone operator will continue to buy its wholesale services.

On Thursday MetroPCS announced that their company is considering the possibility of purchasing the fourth generation wireless services from Clearwire. This will help MetroPCS expand in the highly populated metro areas where it has a poor presence.

The share of Clearwire were up by 42 cents on the Nasdaq stock exchange. The company is planning to attract $300 million in investments that can support its future operations. The share of the company were up by 1.8 percent shortly after the announcement.

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.