Clearwire -- the company that actually provides the 4G data service for Sprint -- announced its third-quarter earnings today. Revenue was at $147 million -- up 114 percent over last year, and subscribers increased to 2.84 million -- a 402 percent increase year over year.
But it was the following statement that started to send us into a small tizzy:
"While we continue to exceed our subscriber and operational goals, we have not yet secured future funding and prudence dictates that we take appropriate cash conservation steps to reduce costs. We continue to pursue all options for future funding including debt, equity or a potential sale of excess spectrum or other assets, and we remain cautiously optimistic that we will resolve our short-term funding needs in the near future. We continue to believe that our unmatched spectrum portfolio and our all-IP based network will keep us extremely well positioned in the dynamic and burgeoning market for mobile data."
Whoa. Wait a second. Before anybody freaks out and worries about losing their 4G data on their Evos and Epics, remember that companies have to think ahead. Way ahead. And so they're cutting back now so they have enough cash for later. That's the way business works.
Sprint, for its part, told us that "our 4G plans remain unchanged" and followed up with this:
"Sprint’s CEO, Dan Hesse recently stated that Sprint has been in discussions with Clearwire regarding the financial status of its ongoing operations as well as Sprint potentially providing new financing. We expect those discussions to continue as we review alternatives with Clearwire. There is no assurance that the discussions will result in any transaction with Clearwire."
Is the ship sinking? Not hardly. Nobody's making a move for the life jackets. But everybody has their eyes trained on the horizon, which is the way it should be. [SEC via Phonescoop, TechFlash]