Sprint announced increased losses for the second quarter of 2012, as it continues to invest in the modernisation of its network – including the phase-out of its Nextel iDEN infrastructure.

The company saw its wireless service revenue increase during the period, as it saw an increase in consumer spending on its more lucrative contract tariffs.

The company announced a net loss of US$1.37 billion for the period, compared with US$847 million in Q2 2011, on revenue of US$8.8 billion, up 6 percent from US$8.3 billion. On an operating level, the company reported a loss of US$629 million, compared with a prior-year profit of US$79 million.

Among the factors cited by the company were depreciation charges of US$782 million related to its Network Vision modernisation project and the closure of the Nextel network; US$184 million for lease exit costs related to the Nextel phase-out; and an impairment of US$204 million related to its investment in wholesale service provider Clearwire.

Wireless segment operating loss was US$681 million, compared with a US$27 million prior-year loss, on revenue of US$8.07 billion, up 8 percent from US$7.45 billion.

Wireless service revenue of US$7.3 billion during the quarter was up more than 8 percent year-on-year, driven by growth in contract ARPU – it said the growth of US$4.31 is “the largest quarterly year-over-year increase on record for the US wireless industry”.

Capital expenditure for the wireless business during the second quarter was US$1 billion, compared with US$546 million in the comparable period in 2011. The company said it invested US$704 million in Network Vision and “approximately US$230 million in data capacity related to both legacy network and Network Vision equipment”.

At the end of the period, Sprint had 56.39 million mobile customers, compared with 52.12 million at the end of June 2011. This included around 32.6 million contract customers, 15.4 million prepaid users, and 8.4 million wholesale and affiliate subscribers.

It noted that 60 percent of total subscribers who had left the Nextel iDEN network during the period were “recaptured” by Sprint, compared to 27 percent in the same period in 2011.

The company said it sold 1.5 million iPhones during the second quarter, with 40 percent going to new contract customers.

Subsidy costs for the period were around US$1.5 billion, compared with US$1.1 billion in the year-ago quarter, which was attributed primarily to the launch of the iPhone.

The company said that Network Vision “remains on track,” with 9,600 Nextel sites taken off-air to date. The company expects to bring 12,000 updated sites on-air by the end of 2012, with the project largely complete by the end of 2013.

The company has launched its 4G LTE services in “five major markets and 15 cities.”