After just four months on the job, Michel Combes has been promoted as CEO at Sprint.
"Since joining Sprint, Michel has been a great ally to me, and he has quickly won the respect of the Sprint team while driving the team to deliver results,” explained Sprint’s current CEO Marcelo Claure today during the carrier’s quarterly conference call with analysts.
As part of the shuffle, Claure will become Sprint’s executive chairman as well as COO of Sprint parent SoftBank Group Corp. and CEO of SoftBank Group International. SoftBank owns roughly 83% of Sprint.
"Though I'm shifting my focus, I'm not leaving,” Claure said of his current role as Sprint’s CEO, a position he gained in 2014. “The reason for effecting this change now is to collaborate with John Legere [T-Mobile’s CEO] for securing regulatory approval [for a merger between T-Mobile and Sprint] for the next 9 to 18 months. That is the most important goal to optimizing shareholder value."
As for Claure’s new role at SoftBank: "My main responsibility will be to optimize synergies across group companies and how they can work with Sprint and ultimately the new company."
Combes joined Sprint in January to replace CFO Tarek Robbiati. Before joining Sprint, Combes was the former head of French cable company Altice. Prior to that position, Combes was the CEO of Alcatel-Lucent during the company’s sale to Nokia.
Sprint announced the management shuffle in conjunction with the release of the company’s quarterly results, in which Sprint notched 55,000 postpaid phone net additions and 170,000 prepaid net additions.
Sprint’s CEO changeup also comes just days after the company inked a massive merger agreement with T-Mobile in a transaction that—if approved—would combine the nation’s third and fourth largest wireless network operators into a third nationwide carrier that would be almost as big in terms of wireless customers as AT&T.
Here’s a look at Sprint’s quarterly results:
Prepaid to postpaid migration program: During the company’s quarterly call with investors, Sprint’s VP of investor relations, Jud Henry, announced that most of the carrier’s 55,000 postpaid phone net additions during the period stemmed from Sprint’s new prepaid-to-postpaid customer migration program.
"Our results for the fourth quarter and future quarters include the introduction of a program to reward tenured prepaid customers with access to postpaid offers under their respective brands,” Henry said. “Due to the changing dynamics that we see in the marketplace, prepaid customers have more options for unlimited data plans across postpaid carriers, and we want to provide select prepaid customers that opportunity while staying with the brand they love. As a result, we have approximately 44,000 net migrations from prepaid to non-Sprint branded postpaid during the fourth quarter. In addition, we recognized a base adjustment of 167,000 between prepaid and postpaid."
Network: Sprint previously announced it would launch nationwide 5G services in the first half of next year, and to reach that goal it would deploy 2.5 GHz equipment, small cells and MIMO antennas. Claure said that so far the carrier has installed 2.5 GHz equipment on 60% of its macro cell sites, and he expects to complete that work by the end of fiscal 2018. Additionally, he said, “in fiscal fourth quarter alone, we deployed more outdoor small cells than the previous two years combined.”
2018 distribution expansion: Sprint said during this year it expects to open more than 500 new Sprint-branded stores and 800 new Boost stores.
5G pricing: During the carrier’s quarterly conference call with analysts, Claure was asked for details about Sprint’s planned price increase tied to the launch of its 5G service. Although Claure didn’t provide specifics, he promised that “we will continue to be the absolute price leader” in the 5G space.
Financials: For its full fiscal year 2017, Sprint reported net cash of $10.1 billion and net income of $7.4 billion (a figure that included a one-time $7.1 billion noncash benefit from tax reform).