The carrier also said in a statement that it plans to cut $2 billion or more in operating expenses for its fiscal 2016 year, which begins in April.
Sprint CEO Marcelo Claure nonetheless pointed to customer momentum and network improvements in the company's second fiscal quarter, which ended Sept. 30. "This quarter marks a very important milestone in our turnaround," he said during a morning call for analysts.
Claure said Sprint was the only national carrier to improve its post-paid net customer numbers, which were up 237,000 compared to net losses of 500,000 for the same quarter a year ago. Sprint also had its best-ever post-paid churn rate (a measure of cancellations), which improved to 1.54% from 2.18% a year ago.
Sprint's loss totalled $585 million or 15 cents a share; Thomson Reuters analysts had predicted a loss of just 8 cents a share. Analysts also predicted revenues of $8.14 billion, but Sprint reported $7.98 billion. That's down 6% from $8.49 billion a year ago.
Investors reacted by selling Sprint stock, which was down by more nearly 7% at noon ET Tuesday, selling at $4.51 a share.
Japanese tech conglomerate Softbank owns more than 70% of Sprint following a merger in mid-2013.
Given the positive customer news, Roger Entner, an analyst at Recon Analytics, said: "Sprint is on the right path, but not yet out of the weeds. It's all about execution and growth -- the profits will follow eventually."
He said Sprint's drop in stock price may be related to a lack of clarity about some parts of the carrier's business, including a new leasing plan. Claure said Sprint is establishing a handset leasing company, which it expects to close on in the next few weeks.
Steve Vachon, an analyst at Technology Business Research, had a more negative view of Sprint's outlook. While Sprint is spending more to be a low-price leader for post-paid service and provide better network coverage, the company will be left "in a bind" as it tries to reduce operating expenses in 2016, he said.
He also criticized Sprint for dropping out of the upcoming 600MHz spectrum auction. Though Sprint said it doesn't need the added spectrum, Vachon believes Sprint dropped out of bidding as a cost-cutting move and because of negative cash flow.
"The decision will be detrimental to the carrier in the long term as Sprint currently lacks lower-band spectrum licenses, and the withdrawal from the auction will play to its competitors' advantage -- particularly T-Mobile -- as the FCC is reserving a designated amount of spectrum that smaller carriers can bid on exclusively," Vachon said.