The loss widening out was based upon the higher costs of the iPhone.  If our math is correct, the narrower loss is simply because they sold fewer iPhones against expectations.  How is that possible.  If one carrier is not going to drop your call with excess capacity, it is Sprint.

The company is taking a loss up front to get a gain in ongoing monthly subscriber service fees. Shares were apparently up over 4% earlier on, but the stock is up 1.6% at $2.49 in the pre-market at 8:43 AM EST.

With a 52-week range of $2.10 to $6.45, is it fair to still wonder if Sprint is truly a viable company.  The cost savings from network consolidations and its other operating cost efforts are only part of the help.  Sprint needs to figure out a way to win more subscribers, and more importantly it needs to ensure that it can make those customers profitable under even a base case subscriber scenario.

JON C. OGG

The earnings previews are for the following: Akamai Technologies, Inc. (NASDAQ: AKAM); Atmel Corporation (NASDAQ: ATML); Cisco Systems Inc. (NASDAQ: CSCO); Computer Sciences Corporation (NYSE: CSC); Enbridge Inc. (NYSE: ENB); Groupon Inc. (NASDAQ: GRPN); Ingram Micro Inc. (NYSE: IM); IntercontinentalExchange Inc. (NYSE: ICE); Level 3 Communications Inc. (NASDAQ: LVLT); Moody’s Corporation (NYSE: MCO); News Corp. (NASDAQ: NWSA); PAA Natural Gas Storage L.P. (NYSE: PNG); Plains All American Pipeline L.P. (NYSE: PAA); Prudential Financial Inc. (NYSE: PRU); Ralph Lauren Corporation (NYSE: RL); Reynolds American Inc. (NYSE: RAI); Sprint Nextel Corporation (NYSE: S); Time Warner Inc. (NYSE: TWX); Vical Inc. (NASDAQ: VICL); Visa Inc. (NYSE: V); and Whole Foods Market Inc. (NASDAQ: WFM).

We have compiled earnings preview on each company using Thomson Reuters consensus estimates and added color on each if applicable.  Some are market moving, some are sector moving, and some are just interesting for traders to watch around the earnings reports.

Akamai Technologies, Inc. (NASDAQ: AKAM) has estimates of $0.40 EPS and $311.26 million in revenues.

Atmel Corporation (NASDAQ: ATML) has estimates of $0.09 EPS and $401.5 million in revenues.    Growth is gone, but it still screens as value.

Cisco Systems Inc. (NASDAQ: CSCO) has estimates of $0.43 EPS and $11.23 billion in revenues.  Preliminary preview notes are available.

Computer Sciences Corporation (NYSE: CSC) has estimates of $0.58 EPS and $3.98 billion in revenues.  As a reminder, CSC has warned on earnings.  This one shows up as a value stock in all sorts of investor screens but it is a value trap.

It sounds good on the surface considering how bad things have been.  The problem is that gross profit as a percent of net sales in the quarter is expected to be about 35%.  That margin was about 41% a year earlier and that implies far worse earnings.  The new earnings guidance is $0.11 to $0.13 per share.  A year earlier was $0.51 per share and Thomson Reuters was calling for $0.35 EPS.

The company blamed “a shift in mix within mobility sales towards certain lower margin smartphones and mobile devices; a higher percentage of mobility sales in the overall revenue mix, largely driven by the Company’s expansion of Target mobile centers; and the impact of a more promotional holiday season.”  That is a lot of moving parts and too many for investors.

Another blame was “in large part to the underperformance of the Sprint postpaid wireless business and reflect further unanticipated changes in Sprint’s customer and credit models.  These changes resulted in fewer new and upgrade activations and a decline in Sprint postpaid revenues in the fourth quarter compared to the 2010 fourth quarter and compared to third quarter 2011.  In addition, fourth-quarter results reflect a highly promotional holiday season and ongoing pressures on consumer spending.”

Sprint Nextel Corporation is down as well on the news by 1.4% in the after-hours.  That is nothing compared to RadioShack Corporation (NYSE: RSH) with a drop of over 17% to $8.43.

The prior 52-week low was only $9.15.

JON C. OGG

AT&T Inc. (NYSE: T), Verizon’s chief competitor, is scheduled to report earnings on Thursday. Analysts are expecting EPS of $0.44 on revenue of $31.96 billion. Sprint Nextel Corp. (NYSE: S) reports quarterly earnings on February 8th, and is expected to post an EPS loss of -$0.37 on revenue of $8.69 billion.

Verizon took a non-cash charge of $1.20/share “ due to the actuarial valuation of Verizon’s benefit plans.” Including that charge and a $0.03/share charge for debt extinguishment, Verizon posted a quarterly EPS loss of -$0.71.

For the full year, Verizon posted GAAP EPS of $0.85, and non-GAAP EPS of $2.15. Analysts were expecting non-GAAP EPS of $2.16. Full-year revenue came in at $110.9 billion, slightly higher than the consensus estimate of $110.84 billion.

Operationally, Verizon Wireless revenue for the quarter totaled $18.3 billion and the company added 1.2 million postpaid customers and 300,000 pre-paid customers during the quarter. Total subscriber connections rose 6.3% year-over-year to 108.7 million. Of that total, 92.2 million are retail customers and the rest are wholesale and other connections. Average revenue per user (ARPU) for retail customers rose just 2.3% in 2011, to $54.34.

Smartphones, including the Apple Inc. (NASDAQ: AAPL) iPhone, accounted for 44% of the company’s postpaid business, up sequentially from 39%. Verizon Wireless began selling the iPhone in October, and sold 4.2 million iPhones in the quarter.

Verizon’s wireline business grew, thanks to new subscribers to its fibre-optic network, FiOS. Plain switched-access phone customers declined by -15.3% in 2011, while digital connections grew by nearly 30%. For the full year, ARPU rose 9.2% in wireline operations to $93.07.

Verizon claims that its 4G LTE network now reaches more than 200 million people in 195 US markets. The company is also seeking regulatory approval for an addition to its spectrum licenses that would give Verizon Wireless coverage of 93% of the total US population.

Paul Ausick

Verizon Wireless, the joint venture between Verizon Communications Inc. (NYSE: VZ) and Vodafone Group plc (NASDAQ: VOD), did not just sit on its hands while AT&T tried to push through the T-Mobile deal. The company paid $3.6 billion for unused spectrum owned by SpectrumCo, a consortium of Comcast Corp. (NASDAQ: CMCSA), Time Warner Cable Inc. (NYSE: TWC), and Bright House Networks.

Other potential AT&T acquisitions include MetroPCS Communications Inc. (NYSE: PCS), Leap Wireless International Inc. (NASDAQ: LEAP), and even Sprint Nextel Corp. (NYSE: S). But none would be as good as a deal for Dish.

AT&T’s main problem is that it would have to pay a premium price for Dish — perhaps as much as $50/share, or about 70% above today’s share price. That would value Dish at around $22 billion, a steep price given that AT&T just paid out $4 billion to T-Mobile in break-up fees. Even Ma Bell can’t afford to pay that kind of money too often for nothing in return, and it’s a sure bet that Dish would want a substantial break-up fee as part of any deal.

A report at Bloomberg News notes that Verizon Wireless owns 56 percent more 4G spectrum than AT&T in the top 10 markets and 46 percent more in the top 100. Verizon Wireless also claims 107.7 million subscribers compared with AT&T’s 100.7 million. Had AT&T been able to acquire T-Mobile, it would have increased its spectrum by 62%, leveling the playing field.

Dish recently acquired wireless spectrum from two bankrupt satellite television companies for about $2.8 billion in a deal that is still awaiting FCC approval. Verizon’s deal with SpectrumCo also needs regulatory approval, and so far there is no indication that either approval is in trouble.

But what does AT&T want with a satellite TV business? Of course it could hive it off once the deal is done, but it might make more sense to go after MetroPCS or Leap, both of which are simply wireless carriers. Or AT&T might be able to get Dish to sell just the spectrum. That would not be the best deal for Dish shareholders, but the company’s management would certainly be able to retire following such a transaction.

Dish shares are trading up more than 2% today at $29.34 in a 52-week range of $20.85-$32.56. Shares of AT&T are up almost 1% at $30.30 in a 52-week range of $27.20-$31.94.

One issue to consider… Dish would have every right in the world to demand another massive deal break-up fee in case the telecom giant could not convince regulators that this is good for consumers.

Paul Ausick

Sprint’s 4G LTE service, part of its Network Vision rollout, will reach 10 or fewer cities by mid-year. That means it cannot claim it has anything close to national coverage until 2013, at the earliest.

Sprint took a chance with long odds when it tried to take an early lead in 4G with its WiMAX product. Sprint made the critical mistake of adopting of a standard that was never likely to be used by all other major carriers. It now pays for that gamble with its late entry into the market with the widely accepted LTE product.

Sprint has made a long series of missteps, with its LTE rollout only the latest. Also among them was a lack of concentration on customer service, which damaged its reputation for years. The company argues that its merger with Nextel cost its the ability to properly serve customers from both that firm and Sprint. It may be a reasonable excuse, but that has not helped Sprint shareholders or customers. It has, however, helped freeze Sprint’s customer base at about 50 million. AT&T and Verizon Wireless have continued to grow. Sprint cannot play catch-up in a saturated U.S. market in which cell phones outnumber people. Carriers can add customers only by taking them from the competition.

However much Sprint’s customers have suffered, its shareholders have been hurt more by the company’s poor strategic decisions. Over the past five years, its stock is down more than 80%, compared to a 10% drop by AT&T. AT&T’s dividend more than makes up for its share performance shortfall.

Sprint’s late LTE rollout will ensure that it continues to languish in third place, far behind its competition.

Douglas A. McIntyre

Slow wage growth may keep U.S. consumer spending weak this year. (Reuters)

Hyundai and Kia expect slower growth in 2012. (Reuters)

Verizon Wireless kills a $2 transaction fee due to customer objections. (Reuters)

Eastman Kodak (NYSE: EK) loses a third board member in two weeks. (Reuters)

The UK sells mortgage company Northern Rock to Virgin. (Reuters)

China’s PMI rises to 50.3, a sign of slow growth. (WSJ)

An international arbitration panel gives Exxon Mobil (NYSE: XOM) only $908 million for Venezuela assets; the oil firm had asked for payment of $7 billion. (WSJ)

Sprint-Nextel (NYSE: S) offers superfast broadband firm LightSquared a 30-day extension to get its system approved by the U.S. government. (WSJ)

A tax credit for ethanol to expire after being in place for 30 years. (NYT)

Austerity programs will make GDP growth in many eurozone nations very difficult. (NYT)

Sarkozy and Merkel warn their nations that 2012 will be more difficult economically than 2011. (FT)

Major global markets lose $6.3 trillion in value in the past year. (FT)

Eurozone leaders try to gain extra time to rebuild the region through promises of aid and new austerity. (Bloomberg)

Manufacturing in India and China signal that they are being hurt by EU economic trouble. (Bloomberg)

Japan’s population drops the most since World War II. (Bloomberg)

Douglas A. McIntyre

Verizon (NYSE: VZ) arguably had the number one brand in wireless service in the U.S. AT&T (NYSE: T) had nearly destroyed its because of trouble with its 3G network that was allegedly caused by data overloads from Apple (NASDAQ: AAPL) iPhone subscribers. Sprint-Nextel (NYSE: S) never had a particularly good reputation for service, and it suffers from its position as the third horse in a three-horse race.

Verizon had two choices, and it probably made the wrong one. It wanted to launch its 4G LTE network ahead of AT&T’s. Verizon also believed that it could flank the less-popular WiMax 4G technology that Sprint-Nextel deployed. WiMax is not compatible with the more widely adopted LTE standard. This likely made it less attractive to many customers.

Verizon’s 4G network has been down three times in the past month. Many customers will not forgive this. Many of those subscribers who can afford to break two-year contracts will do so. Others will wait until their contracts run out. If Verizon still has the problem as millions of 4G subscription deals reach the renewal stage, a migration to AT&T, Sprint or T-Mobile could become a flood of defections.

Verizon, early to market with 4G, may have undermined its chance to be a leader in the industry over the longer term.

Douglas A. McIntyre

The problem is not unlike the one AT&T Wireless had for months with the 3G service for the Apple (NASDAQ: AAPL) iPhone. AT&T (NYSE: T) was the only carrier to offer the iPhone then. The smartphone’s ability to transfer data and multimedia unexpectedly burdened AT&T’s 3G infrastructure and slowed service enough that customers began to rate the telecom firm’s service well below that of its rivals. It has taken AT&T at least two years to reverse that negative perception. In the meantime, it is hard to say how many consumers dropped the service or chose not to use it at all. But AT&T’s wireless business certainly suffered.

The Verizon problem, and AT&T’s before it, are examples of the lack of preparation wireless companies make as they rush to market with new products and services. None of the big U.S. wireless carriers can afford to fall behind its rivals. That makes each take some level of risk over whether their services will be adequate to customer needs.

Verizon is about to learn the lesson that AT&T did. Being first to market with a popular feature is a powerful tool. If that feature does not work well, being first can be ruinous.

Douglas A. McIntyre

Sprint has just thrown all its cash behind the iPhone from Apple Inc. (NASDAQ: AAPL), and its current market cap of around $7 billion probably isn’t going to attract more than $30 billion in lending. Besides, Sprint was vocally opposed to the AT&T/T-Mobile deal and might be in line for some payback for the breakdown. But DT has other issues to solve.

First, of course, are shareholders’ expectations, which have been severely pulled in following the cancellation of the T-Mobile sale. According to a report at Bloomberg News, DT planned to use about $6.5 billion to repurchase shares and cut debt, both welcomed by shareholders. A bonus was the 8% stake that DT would acquire in AT&T. That’s all gone.

Worse, though, is that unless DT can come up with another deal, dividend payouts beyond 2012 are questionable. The company’s current dividend yield is 7.9%, but with other expenses facing DT some analysts question how long that payout can last.

The final drag on DT is Europe, where it conducts most of its business. European economies are struggling and so are European consumers. DT expects to return to growth in Europe by 2013, but that may be wishful thinking given the current state of affairs.

Paul Ausick