Shares in Leap Wireless International were up more than 15 percent in early trading today after the company yesterday reported net additions of 10,000 in the third quarter.
Leap's net loss for the third quarter was $68.8 million, down from last year's third-quarter net loss of $536.3 million. Churn, typically higher in the third quarter, was 3.8 percent, down from the year-ago quarter when it was 5.5 percent.
In a conference call with analysts, Leap President and CEO Doug Hutcheson said that while the carrier's 3G network will play an important role for the next several quarters, the company expects to launch its first LTE market "shortly" and serve 25 million POPs by the end of 2012. A commercial trial market is expected to be launched late this year.
In response to a question about whether Leap's prepaid customers want or need the iPhone, which is headed to regional carrier C Spire Wireless, Hutcheson said Leap hasn't had a lot of success selling higher-priced devices. That doesn't mean it won't continue to work on it, but he wasn't sharing any plans at the moment. Leap is selling Android devices for less than $100 now.
Leap's plan for future growth includes expansion of its Muve Music service, which now has 270,000 customers, and further retail expansion. Leap opened 400 new Cricket-branded doors this year and will add another 200 before the end of the year. It's also continuing to expand its national retail distribution, with a presence in 5,700 sites and the expectation to be in more than 11,000 national retail locations once the expansion is complete.
Hutcheson said that customers outside Leap's facilities-based footprint generate lower margins but services outside its footprint also require minimal cap ex. Leap has an MVNO agreement with Sprint to offer service in areas where Leap doesn't own the network.