Clearwire shows subscriber gains, but investors worry over financials

Shares of Clearwire Corp. slid after the wireless broadband carrier reported a net first-quarter loss of $92.6 million, up drastically from the $55.2 million loss over the same period last year.
Craig McCaw’s Kirkland, Wash.-based outfit said it saw a 41% increase in subscriber growth during the quarter, reaching a total of 258,000 customers, and the company more than tripled its quarterly service revenue to $29.3 million. Clearwire said it showed a better-than-expected churn of 1.6% per month, and ended the quarter with about 100 million potential customers covered throughout 375 cities in the United States and Europe.
The firm said its equipment revenue declined to zero, however, following the sale of its NextNet Wireless subsidiary to Motorola Inc. last year. The firm also reported $74.4 million in capital expenditures during the quarter.
Clearwire, which ended the quarter with $1.5 billion in cash and short-term investments, is expected to continue to raise money as it shops for spectrum and builds out networks in new markets.
“We are building a network today that is doing for the Internet what cellular networks did for voice communications,” said CEO Ben Wolff. “The solid financial results and strong subscriber acquisitions we demonstrated this quarter speak volumes about the mass-market appeal of our differentiated broadband offering.”
Investors disagreed, though, as Clearwire shares lost 68 cents, or almost 4 percent, to $18.32 by mid-day.
The quarter marked Clearwire’s first as a publicly traded company.