San Diego Business Journal

Leap Wireless Reports Decline in Net Loss, Rise in Revenue

Tuesday, February 21, 2012

Leap Wireless International Inc., a spinoff public company from Qualcomm Inc. that sells advanced, flat-rate pay cellphone services, reported Feb. 16 a fourth-quarter net loss of $84.4 million, compared with a net loss of $249.4 million for the like quarter of 2010.

Leap, which operates under the brand Cricket, reported a net loss of $314.6 million for 2011, compared with a net loss of $871.9 million in 2010.

Revenue in the fourth quarter was $767.4 million, compared with $708 million for the like quarter of 2010. 2011 revenue was $3 billion, up from $2.7 billion in 2010.

Shares of Leap, traded under LEAP on Nasdaq, surged after the quarterly report was released, and following published reports that AT&T was a possible buyer of the company.

But shares fell the following day, Feb. 17, by 38 cents to $9.24, giving it a market capitalization of $727 million.

Leap said it added a net of 179,000 customers during the fourth quarter, up from 107,000 customers in the fourth quarter of 2010. It ended the year with 5.9 million customers; up 7.5 percent from the end of 2010.

“We had solid performance in the fourth quarter and are pleased with the operational progress the business has made,” said Leap CEO Doug Hutcheson.

The company has been selling an increased number of smartphones, which made up about 60 percent of all devices sold in the last quarter, it said.

Leap said it launched 4G services in Tucson, Ariz., in December and plans to spend $600 million to $650 million this year for an initial deployment of next generation LTE (a type of 4G service) and for ongoing maintenance of its networks.

— Mike Allen