Sprint posts loss, scraps dividend

Sprint Nextel Corp., the third-biggest U.S. wireless carrier, posted a $29.5-billion loss and scrapped its dividend after writing down most of the Nextel Communications Inc. acquisition from two years ago.

The company’s shares sank as much as 13% in New York trading.

Sprint reported a fourth-quarter loss of $10.36 a share. Sales fell 5.7% to $9.85 billion, missing analysts’ estimates, and the carrier borrowed $2.5 billion under a credit line.

The write-down put Nextel’s value at 80% less than when it was acquired. That loss is the fifth-largest among Standard & Poor’s 500 index companies since 1990.

Sprint expects 1.2 million subscribers to leave this quarter, as many as it lost in all of 2007. Chief Executive Dan Hesse, who took over in December, said business was deteriorating.

“We need an articulated strategy of how he’s going to turn around the business,” said Michael Nelson, an analyst at Stanford Group Co. in New York. “I don’t expect it to be a pretty picture.”

Shares of Overland Park, Kan.-based Sprint fell to their lowest level since October 2002. The stock dropped 86 cents to close at $8.09 and earlier reached $7.75, its steepest percentage decline since Jan. 18.