Clearwire caught between subscriber growth, maintaining revenues

Clearwire (Nasdaq: CLWR) is caught in a cycle of trying to drive subscriber growth without exhausting its limited operating revenues. The company, majority owned by Sprint (NYSE: S) with contributions from cable partners Comcast (Nasdaq: CMCSA), Time Warner Cable (NYSE: TWC-WI) and Bright House Networks, posted a $128 million fourth quarter loss on $180.7 million in revenue.

Both numbers were higher than last year when the loss was $98.7 million and the revenue was $79.9 million. Clearwire also signed up more than 1.5 million subscribers in the fourth quarter and, perhaps evidencing a future trend, said 1.42 million came from deals with its telco and cable wholesale partners.

The seemingly schizophrenic results reflect Clearwire's determination to build a nationwide wireless network while trying not to exhaust what funding it has left. Reports have suggested that Clearwire will concentrate more heavily on its wholesale business, but CEO Bill Morrow, in an earnings news release preferred to hedge that a bit, noting, the service provider "will prudently pace our retail growth in an effort to maximize our financial resources."

The conundrum, even Morrow pointed out, is clear. "Clearwire is one of the fastest growing companies in the wireless industry. Despite this strong growth, our current plans and funding dictate that we remain prudent with our spending," he said.

For more:
- the Kansas City Business Journal has this story

Related articles:
S&P downgrades Clearwire to 'highly speculative' territory
Kagan: Clearwire could be a loss leader for the broadband wireless space
Clearwire courting more cable partners, says CFO Prusch

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