Sprint's Q1: Not As Bad As Expected

Sprint Corp (NYSE: S) shares were seen surging Tuesday after the company posted an earnings beat and delivered a quarterly profit for the first time in three years.

Sprint CEO Marcelo Claure also spoke on the merger talks that have surrounding the company for some time, saying that merger talks should come in the “near future.” The CEO applauded the results via Twitter Inc (NYSE: TWTR), celebrating the company's fourth consecutive quarter of year-over-year growth in Q1.

Related Link: Big Telecom Earnings Recap: Sprint Ticks Higher

UBS analyst John C. Hodulik weighed in after the first quarter release, saying that 'results were better than feared' (see his track record here). Revenues grew 1.8 percent in the first quarter, and free cash flow was $239 million, ahead of street and UBS estimates, due to stronger cash from operations.

The wireless provider EBITDA came in higher partly due to a higher leasing mix, that grew to 55 percent from 44 percent a year ago. Sprint raised the low end of its F2017 EBITDA guidance and now expects EBITDA of $10.8 billion–$11.2 billion.

Postpaid handset adds were 88,000 in the quarter, the eighth quarter of consecutive growth and well higher than UBS estimates of 46,000. Total prepaid adds came in at 35,000 vs -423,000 a year prior.

UBS maintains a Neutral rating on Sprint with $9 price target.

At time of publication, shares of Sprint were up 11.13 percent at $8.88.