Sprint - Nextel 2014 Annual Report Download - page 41

Table of Contents
39
Average Monthly Service Revenue per Subscriber and Subscriber Trends
The table below summarizes average number of retail subscribers. Additional information about the number of
subscribers, net additions (losses) to subscribers, and average rates of monthly postpaid and prepaid subscriber churn for each
quarter since the quarter ended March 31, 2012 may be found in the tables on the following pages.
Successor Combined Successor Predecessor
Year Ended
March 31,
Three Months
Ended
March 31, Year Ended December 31, Year Ended December 31,
191 Days
Ended
July 10,
Three Months
Ended
March 31, Years Ended December 31,
2015 2014 2013 2013 2013 2013 2012
(subscribers in thousands)
Average postpaid subscribers 30,068 30,639 31,124 30,957 31,296 31,566 32,462
Average prepaid subscribers 15,401 16,097 15,901 16,040 15,793 15,686 15,291
Average retail subscribers 45,469 46,736 47,025 46,997 47,089 47,252 47,753
The table below summarizes ARPU. Additional information about ARPU for each quarter since the quarter ended
March 31, 2012 may be found in the tables on the following pages.
Successor Combined Successor Predecessor
Year Ended
March 31,
Three Months
Ended
March 31, Year Ended December 31, Year Ended December 31,
191 Days
Ended
July 10,
Three Months
Ended
March 31, Years Ended December 31,
2015 2014 2013 2013 2013 2013 2012
ARPU(1):
Postpaid $ 59.32 $ 62.98 $ 63.29 $ 63.46 $ 63.10 $ 62.47 $ 60.84
Prepaid $ 27.81 $ 27.07 $ 26.62 $ 26.64 $ 26.57 $ 26.08 $ 26.72
Average retail $ 48.65 $ 50.61 $ 50.89 $ 50.89 $ 50.85 $ 50.39 $ 49.92
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(1) ARPU is calculated by dividing service revenue by the sum of the monthly average number of subscribers in the applicable service category. Changes
in average monthly service revenue reflect subscribers for either the postpaid or prepaid service category who change rate plans, the level of voice and
data usage, the amount of service credits which are offered to subscribers, plus the net effect of average monthly revenue generated by new subscribers
and deactivating subscribers. Combined ARPU for 2013 aggregates service revenue from the Predecessor191-day period ended July 10, 2013 and the
Successor year ended December 31, 2013 divided by the sum of the monthly average subscribers during the year ended December 31, 2013.
Successor Year Ended March 31, 2015 and Successor Year Ended December 31, 2013
Postpaid ARPU for the Successor year ended March 31, 2015 decreased compared to the year ended
December 31, 2013 primarily due to growth in sales of tablets, which carry a lower revenue per subscriber combined with the
impact of subscriber migration to many of our new service plans, resulting in lower service fees. We expect Sprint platform
postpaid ARPU to continue to decline during fiscal year 2015 as a result of lower service fees associated with many of our
new price plans, and a continued increase in tablet mix that carry a lower ARPU; however, as a result of our installment
billing and leasing programs, we expect reduced equipment net subsidy expense to partially offset these declines. Prepaid
ARPU for the Successor year ended March 31, 2015 increased compared to the year ended December 31, 2013 primarily due
to an increase of higher average Boost subscribers which carry a higher ARPU as compared to other prepaid brands partially
offset by decreases in total average subscribers, primarily in the Virgin Mobile and Assurance brands.
Successor Three-Month Transition Period Ended March 31, 2014 and Predecessor Three-Month Period Ended
March 31, 2013
Postpaid ARPU for the Successor three-month transition period ended March 31, 2014 increased compared to the
same Predecessor period in 2013 primarily due to the shut-down of the Nextel platform on June 30, 2013 and the impact of
losing subscribers who carried a lower average revenue per subscriber. This increase was partially offset by a lower revenue
per subscriber carried by subscribers acquired in the Clearwire and U.S. Cellular acquisitions and growth in sales of tablets,
which also carry a lower revenue per subscriber. Prepaid ARPU for the Successor three-month transition period ended
March 31, 2014 increased compared to the same Predecessor period in 2013 primarily due to the impact of a higher revenue
per subscriber carried by subscribers acquired in the Clearwire acquisition combined with an increase in ARPU primarily for
the Virgin Mobile prepaid brands as subscribers chose higher priced plans.