sprint nextel Quarterly Presentations 2007 4th

Sprint Nextel
Investor Quarterly Update - 4Q07

February 28, 2008

© 2008 Sprint Nextel. All rights reserved.

Kurt Fawkes
Vice President of Investor Relations


Cautionary Statement
• This presentation includes “forward-looking statements” within the meaning of the securities laws. The statements in this presentation regarding the
business outlook, expected performance, forward looking guidance, as well as other statements that are not historical facts, are forward-looking statements.
The words quot;estimate,quot; quot;project,quot; ”forecast,” quot;intend,quot; quot;expect,quot; quot;believe,quot; quot;target,quot; “providing guidance” and similar expressions are intended to identify
forward-looking statements. Forward-looking statements are estimates and projections reflecting management's judgment based on currently available
information and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking
statements. With respect to these forward-looking statements, management has made assumptions regarding, among other things, customer and network
usage, customer growth and retention, pricing, operating costs, the timing of various events and the economic environment. Future performance cannot be
assured. Actual results may differ materially from those in the forward-looking statements. Some factors that could cause actual results to differ include:
• the effects of vigorous competition, including the impact of competition on the price we are able to charge customers for services and equipment we provide
and our ability to attract new customers and retain existing customers; the overall demand for our service offerings, including the impact of decisions of new
subscribers between our post-paid and prepaid services offerings and between our two network platforms; and the impact of new, emerging and competing
technologies on our business;
• the impact of overall wireless market penetration on our ability to attract and retain customers with good credit standing and the intensified competition
among wireless carriers for those customers;
• the impact of difficulties we may continue to encounter in connection with the integration of the pre-merger Sprint and Nextel businesses, and the integration
of the businesses and assets of Nextel Partners, Inc. and the PCS Affiliates that provide wireless PCS under the Sprint® brand name, that we have
acquired, including the risk that these difficulties could prevent or delay our realization of the cost savings and other benefits we expect to achieve as a
result of these integration efforts and the risk that we will be unable to continue to retain key employees;
• the uncertainties related to the implementation of our business strategies, investments in our networks, our systems, and other businesses, including
investments required in connection with our planned deployment of a next generation broadband wireless network;
• the costs and business risks associated with providing new services and entering new geographic markets, including with respect to our development of
new services expected to be provided using the next generation broadband wireless network that we plan to deploy;
• the impact of potential adverse changes in the ratings afforded our debt securities by ratings agencies;
• the effects of mergers and consolidations and new entrants in the communications industry and unexpected announcements or developments from others in
the communications industry;
• unexpected results of litigation filed against us;
• the inability of third parties to perform to our requirements under agreements related to our business operations, including a significant adverse change in
the ability of any of our handset suppliers to provide devices, or Motorola, Inc.’s ability or willingness to provide related equipment and software applications,
or to develop new technologies or features for our iDEN®, network;
• the impact of adverse network performance;
• the costs and/or potential customer impacts of compliance with regulatory mandates, particularly requirements related to the reconfiguration of the 800 MHz
band used to operate our iDEN network, as contemplated by the Federal Communications Commission’s Report and Order released in August 2004 as
supplemented by subsequent memorandums;
• equipment failure, natural disasters, terrorist acts, or other breaches of network or information technology security;
• one or more of the markets in which we compete being impacted by changes in political, economic or other factors such as monetary policy, legal and
regulatory changes or other external factors over which we have no control;
• and other risks referenced from time to time in our filings with the Securities and Exchange Commission, including our Form 10-K for the year ended
December 31, 2006, in Part I, Item 1A, “Risk Factors” and upcoming Form 10-K for the year ended December 31, 2007.

© 2008 Sprint Nextel. All rights reserved. 3

Non-GAAP Financial Measures
Sprint Nextel provides financial measures generated using generally accepted accounting principles (GAAP) and using adjustments to GAAP (non-GAAP).
The non-GAAP financial measures reflect industry conventions, or standard measures of liquidity, profitability or performance commonly used by the
investment community for comparability purposes. These non-GAAP measures are not measurements under accounting principles generally accepted in
the United States. These measurements should be considered in addition to, but not as a substitute for, the information contained in our financial
statements prepared in accordance with GAAP. We have defined below each of the non-GAAP measures we use, but these measures may not be
synonymous to similar measurement terms used by other companies. Sprint Nextel provides reconciliations of these non-GAAP measures in its financial
reporting. Because Sprint Nextel does not predict special items that might occur in the future, and our forecasts are developed at a level of detail different
than that used to prepare GAAP-based financial measures, Sprint Nextel does not provide reconciliations to GAAP of its forward-looking financial
measures.

The measures used in this release include the following:
• Adjusted Earnings per Share (EPS) is defined as income from continuing operations, before special items, net of tax and the diluted EPS calculated
thereon. Adjusted EPS before Amortization is defined as income from continuing operations, before special items and amortization, net of tax, and
the diluted EPS calculated thereon. These non-GAAP measures should be used in addition to, but not as a substitute for, the analysis provided in the
statement of operations. We believe that these measures are useful because they allow investors to evaluate our performance for different periods on a
more comparable basis by excluding items that relate to acquired amortizable intangible assets and not to the ongoing operations of our businesses.
• Adjusted Net Income is defined as income (loss) from continuing operations before special items. Adjusted Net Income before Amortization is
defined as income (loss) from continuing operations before special items and amortization, net of tax. These non-GAAP measures should be used in
addition to, but not as a substitute for, the analysis provided in the statement of operations. We believe that these measures are useful because they
allow investors to evaluate our performance for different periods on a more comparable basis by excluding items that do not relate to the ongoing
operations of our businesses.
• Adjusted OIBDA is defined as operating income before depreciation, amortization, restructuring and asset impairments, and special items. Adjusted
OIBDA less Cap Ex represents Adjusted OIBDA less our capital expenditures. Adjusted OIBDA Margin represents Adjusted OIBDA divided by non-
equipment net operating revenues for Wireless and Adjusted OIBDA divided by net operating revenues for Long Distance. These non-GAAP measures
should be used in addition to, but not as a substitute for, the analysis provided in the statement of operations. We believe that Adjusted OIBDA and
Adjusted OIBDA Margin provide useful information to investors because they are an indicator of the strength and performance of our ongoing business
operations, including our ability to fund discretionary spending such as capital expenditures, spectrum acquisitions and other investments and our
ability to incur and service debt. While depreciation and amortization are considered operating costs under generally accepted accounting principles,
these expenses primarily represent non-cash current period allocation of costs associated with long-lived assets acquired or constructed in prior
periods. Adjusted OIBDA and Adjusted OIBDA Margin are calculations commonly used as a basis for investors, analysts and credit rating agencies to
evaluate and compare the periodic and future operating performance and value of companies within the telecommunications industry.


Normalizing EPS

4Q-07 4Q-06

Net Income EPS Net Income EPS
(millions) (millions)

Reported - Continuing Operations ($29,452) ($10.36) $261 $0.09

Special Items $43 $0.02 $21 $0.00

Goodwill Impairment $29,571 $10.40 $0 $0.00

Amortization $430 $0.15 $560 $0.20

Adjusted $592 $0.21 $842 $0.29


Bill Arendt
Acting Chief Financial Officer &
Controller


Wireless Subscriber Trends
Postpaid Subscribers
41.8M 40.8M
• Lower Q4 gross adds due to
42% 33% iDEN
– Competitive market conditions
– Easing of Q4 seasonal trends
CDMA
58% 67%
– Decline in sub-prime
(incl. PowerSource)

4Q06 4Q07

Prepaid Subscribers
4.6M
11% • Boost Unlimited expansion
Unlimited
4.0M
• Traditional prepaid challenged
Traditional
89%
100%

4Q06 4Q07


Revenue Performance (billions)
Wireline
Total Revenues

$10.44 $1.63
$1.62
$10.04 $1.61
$9.85

Q4-06 Q3-07 Q4-07 Q4-06 Q3-07 Q4-07

Wireless Service Wireless Equipment

$8.21 $0.79
$8.04
$0.68
$0.66
$7.82

Q4-06 Q3-07 Q4-07 Q4-06 Q3-07 Q4-07


Postpaid ARPU Pressure
$59
Data $58

Data ~20%
MRC
Other ~80%
Overage
& Roaming

3Q-07 4Q-07

• Stable CDMA ARPU & Declining iDEN ARPU
• MRC
• Unfavorable mix of deactivations vs. acquisitions
• Family plans
• Higher mix of government and business accounts
• Overage
• Lower iDEN usage & seasonality
• Wireless Data
• Aircards, text messaging, & PowerVision bundles


Sequential Changes to Adjusted OIBDA

$2.88B

Lower
acquisition costs &
$2.46B
Wireline improvements
Churn & ARPU

Customer care, bad
debt & other expenses

3Q-07 4Q-07


Capital Spending & Financial Flexibility
Capital Spending of $6.5B in 2007

$2.0 • CDMA investments in capacity & coverage
• Expanded EVDO rev A to ~220M POPs
$1.7
$1.6 • Continued iDEN quality focus
• Supporting MPLS and Cable VOIP growth
• Initial Xohm construction
$1.2

Q1-07 Q2-07 Q3-07 Q4-07

Greater Financial Flexibility
• Anticipate lower core capital spending in 2008
• $2.5B drawn from revolving credit facility
• Common dividend suspended

Note: capital spending figures do not include the non-network portion of re-banding expenditures.


Dan Hesse
President and CEO


Turnaround will take time, but we’re taking action

• Reducing employees, contractors & under-performing
distribution

• Unified culture focused on the customer experience, urgency
and accountability

• Consolidated HQ

• New leadership


Strong Assets

• People

• Technology

• Spectrum

• 54 Million Customers

• Networks
--CDMA
--IP/MPLS backbone
--iDEN


Actions to Re-invigorate Nextel Direct Connect

• Nextel Direct Connect on both iDEN and CDMA

• New Motorola iDEN handsets

• World’s first iDEN/WiFi Blackberry in 2008

• Network performing at best-ever levels


We Must Improve the Customer Experience
• Job #1

• Churn is top metric

• Lag between improvements and market perception

• Stiff headwinds in 2008

• Anticipate net post paid subscriber loss of 1.2M in Q1

• Adjusted OIBDA decline in Q1 to $1.8 - $1.9B


Positioning the Sprint Brand

Sprint Speed

• Nextel Direct Connect

• Nation’s largest mobile broadband network


Simply Everything

• “One Rate”, for surf, chirp, email, text, navigation
and voice.

• $99.99 Simply Everything

• CDMA and iDEN simplicity

• Family and packaged deals

• Exclusive NFL and NASCAR content


Leadership in 4th Generation

• Technology is working

• Utilizes wealth of spectrum assets

• Xohm three-year 4G head start

• $99.99 Simply Everything and Xohm position Sprint to be the
carrier that leads wireless to reach its full potential


Q&A

• Dan Hesse, President and CEO

• Bill Arendt, Controller & Acting Chief Financial Officer

• Paget Alves, Acting President of Sales & Distribution

• John Garcia, Acting Chief Marketing Officer

• Bob Johnson, Chief Service Officer

• Kathy Walker, Chief Network Officer

• Kurt Fawkes, Vice President of Investor Relations


Non-GAAP Reconciliations
Quarter Ended Quarter Ended Year To Date
September 30, September 30, December 31, December 31, December 31, December 31,
2007 2006 2007 2006 2007 2006

Operating (Loss) Income $ 398 $ 719 $ (29,625) $ 569 $ (28,910) $ 2,484
Special items before taxes
Merger and integration expense (2) 135 107 119 117 516 413
(3)
Severance, exit costs and asset impairments 125 50 56 79 440 207
Goodwill impairment (4) - - 29,729 - 29,729 -
Contingencies and other (7) - 1 (44) 5 2 4
Adjusted Operating Income* 658 877 235 770 1,777 3,108
Depreciation and amortization 2,222 2,488 2,220 2,404 9,023 9,592
Adjusted OIBDA* 2,880 3,365 2,455 3,174 10,800 12,700
Capital expenditures (8) 1,176 1,843 2,009 2,612 6,458 7,057
Adjusted OIBDA* less Capex $ 1,704 $ 1,522 $ 446 $ 562 $ 4,342 $ 5,643

4.2% 7.4% -322.8% 5.9% -76.9% 6.6%
Operating Income Margin (b)
Adjusted OIBDA Margin* (c) 30.7% 34.9% 26.8% 33.0% 28.8% 33.6%
(b)
Operating Income Margin excludes equipment revenue.
(c)
Adjusted OIBDA Margin excludes equipment revenue, revenue generated by the non-core line of business that has been normalized out of Adjusted OIBDA and certain other
non-recurring revenue adjustments.
(2), (3), (4), (7), (8)
See accompanying Notes to Financial Data.


Non-GAAP Reconciliations
RECONCILIATIONS OF EARNINGS PER SHARE (Unaudited)
(Millions, except per share data)

December 31, December 31, September 30, September 30, December 31, December 31,
2007 2006 2007 2006 2007 2006

(Loss) Income Available to Common Shareholders $ (29,452) $ 261 $ 64 $ 279 $ (29,580) $ 1,327
Preferred stock dividends paid - - - - - 2
Net (Loss) Income (29,452) 261 64 279 (29,580) 1,329
Discontinued operations, net - - - - - (334)
(Loss) Income from Continuing Operations (29,452) 261 64 279 (29,580) 995
Special items (net of taxes) (a)
Merger and integration expense 72 71 84 66 316 252
Severance, exit costs and asset impairment 35 52 78 31 274 129
Goodwill impairment 29,571 - - - 29,571 -
Contingencies and other (27) 6 - 2 10 8
(5)
Net gains on investment activities and equity in earnings (37) (92) (4) - (52) (132)
Tax audit settlement - (16) (19) (42) (19) (58)
Gain on early retirement of debt - - (3) (4) (5) (9)
Adjusted Net Income* $ 162 $ 282 $ 200 $ 332 $ 515 $ 1,185

Amortization (net of taxes) 430 560 472 619 2,000 2,320
Adjusted Net Income before Amortization* $ 592 $ 842 $ 672 $ 951 $ 2,515 $ 3,505

Diluted (Loss) Earnings Per Common Share (10.36) 0.09 0.02 0.09 (10.31) 0.45
Discontinued operations - - - - - (0.11)
Diluted (Loss) Earnings Per Common Share from (10.36) 0.09 0.02 0.09 (10.31) 0.34
Continuing Operations
(a)
Special items (net of taxes) 10.42 - 0.05 0.02 10.49 0.06
Adjusted Earnings Per Share* $ 0.06 $ 0.09 $ 0.07 $ 0.11 $ 0.18 $ 0.40

(b)
Amortization (net of taxes) 0.15 0.20 0.16 0.21 0.70 0.78
(b)
Adjusted Earnings Per Share before Amortization* $ 0.21 $ 0.29 $ 0.23 $ 0.32 $ 0.88 $ 1.18

(a)
(b)
Rounding differences are recorded to the Amortization (net of taxes) line.
(5)


Non-GAAP Reconciliations - Wireless
2007 2006 2007 2006 2007 2006

Operating (Loss) Income $ 319 $ 708 $ (29,674) $ 488 $ (29,038) $ 2,222
Merger and integration expense (2) 76 42 87 86 344 191
(3)
Goodwill impairment (4) - - 29,729 - 29,729 -
Contingencies and other (7) - 1 (15) 5 8 4
Adjusted Operating Income* 514 792 168 652 1,429 2,592
Depreciation and amortization 2,089 2,364 2,077 2,257 8,485 9,086
Adjusted OIBDA* 2,603 3,156 2,245 2,909 9,914 11,678
Capital expenditures (8) 813 1,473 1,404 2,238 4,991 5,846
Adjusted OIBDA* less Capex $ 1,790 $ 1,683 $ 841 $ 671 $ 4,923 $ 5,832

Operating Income Margin (b) 4.0% 8.6% -379.2% 5.9% -90.4% 7.0%
Adjusted OIBDA Margin* (c) 32.4% 38.4% 28.7% 35.5% 30.9% 36.6%

(b)
Operating Income Margin excludes equipment revenue.
(c)
Adjusted OIBDA Margin excludes equipment revenue, revenue generated by the non-core line of business that has been normalized out of Adjusted OIBDA and
certain other non-recurring revenue adjustments.
(2), (3), (4), (7), (8)


Non-GAAP Reconciliations - Wireline
2007 2006 2007 2006 2007 2006
Operating Income $ 155 $ 77 $ 194 $ 111 $ 498 $ 454
(3)
(7)
Contingencies and other - - (29) - (6) -
Adjusted Operating Income* 158 86 178 116 540 485
Depreciation and amortization 132 124 142 147 534 506
Adjusted OIBDA* 290 210 320 263 1,074 991
(8)
Capital expenditures 138 255 205 274 632 821
Adjusted OIBDA* less Capex $ 152 $ (45) $ 115 $ (11) $ 442 $ 170

9.6% 4.7% 12.0% 6.8% 7.7% 6.9%
Operating Income Margin
18.0% 12.9% 19.8% 16.1% 16.6% 15.1%
Adjusted OIBDA Margin*

(3), (7), (8)


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