SPRINT 10-K 26 Feb 10 2009 FY Annual report Financial data

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Millions	Dec. 31, 2009	Dec. 31, 2008
Current assets
Cash and cash equivalents	$3,819	$3,691
Short-term investments	105	28
Accounts and notes receivable, net	2,996	3,361
Device and accessory inventory	628	528
Deferred tax assets	295	391
Prepaid expenses and other current assets	750	643
Total current assets	8,593	8,642
Investments	4,624	4,241
Property, plant and equipment, net	18,280	22,373
Intangible assets
Goodwill	373	0
FCC licenses and other	19,911	19,320
Other intangible assets, net	3,178	3,566
Other assets	465	408
Assets, Total	55,424	58,550
Current liabilities
Accounts payable	2,267	2,138
Accrued expenses and other current liabilities	3,750	3,525
Current portion of long-term debt, financing and capital lease obligations	768	618
Total current liabilities	6,785	6,281
Long-term debt, financing and capital lease obligations	20,293	20,992
Deferred tax liabilities	6,693	7,184
Other liabilities	3,558	4,178
Total liabilities	37,329	38,635
Shareholders' equity
Common shares, voting, par value $2.00 per share, 6.5 billion shares authorized, 3.007 and 2.951 billion shares issued, 2.973 and 2.857 billion shares outstanding	6,015	5,902
Paid-in capital	46,793	47,332
Treasury shares, at cost	(582)	(1,939)
Accumulated deficit	(33,779)	(30,856)
Accumulated other comprehensive loss	(352)	(524)
Total shareholders' equity	18,095	19,915
Liabilities and Stockholders' Equity, Total	$55,424	$58,550

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
	Dec. 31, 2009	Dec. 31, 2008
Common shares, par value	$2	$2
Common shares, shares authorized	6,500,000,000	6,500,000,000
Common shares, shares issued	3,007,000,000	2,951,000,000
Common shares, shares outstanding	2,973,000,000	2,857,000,000

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Millions, except Per Share data	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Net operating revenues	$32,260	$35,635	$40,146
Operating expenses
Cost of services and products (exclusive of depreciation and amortization included below)	16,435	16,746	17,191
Selling, general and administrative	9,453	11,355	12,673
Severance, exit costs and asset impairments	447	835	440
Goodwill impairment	0	963	29,649
Depreciation	5,827	5,964	5,621
Amortization	1,589	2,443	3,312
Other, net	(93)	(29)	0
Costs and Expenses, Total	33,658	38,277	68,886
Operating loss	(1,398)	(2,642)	(28,740)
Other (expense) income
Interest expense	(1,450)	(1,362)	(1,433)
Equity in losses of unconsolidated investments, net	(803)	(145)	(3)
Other income, net	157	89	401
Nonoperating Income (Expense), Total	(2,096)	(1,418)	(1,035)
Loss before income taxes	(3,494)	(4,060)	(29,775)
Income tax benefit	1,058	1,264	331
Net loss	($2,436)	($2,796)	($29,444)
Basic and diluted loss per common share	-0.84	-0.98	-10.24
Basic and diluted weighted average common shares outstanding	2,886	2,863	2,874

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Cash flows from operating activities
Net loss	($2,436)	($2,796)	($29,444)
Adjustments to reconcile net loss to net cash provided by operating activities:
Goodwill and asset impairments	47	1,443	29,812
Depreciation and amortization	7,416	8,407	8,933
Provision for losses on accounts receivable	398	652	920
Share-based compensation expense	79	267	265
Deferred and other income taxes	(850)	(1,263)	(326)
Equity in losses of unconsolidated investments, net	803	145	3
Gains from asset dispositions and exchanges	(68)	(29)	0
Contribution to pension plan	(200)	0	(30)
Gain on non-controlling interest in VMU	(151)	0	0
Other changes in assets and liabilities, net of effects of acquisitions:
Accounts and notes receivable	26	203	(504)
Inventories and other current assets	3	342	182
Accounts payable and other current liabilities	(100)	(1,137)	(471)
Other, net	(76)	(55)	(95)
Net cash provided by operating activities	4,891	6,179	9,245
Cash flows from investing activities
Capital expenditures	(1,603)	(3,882)	(6,322)
Expenditures relating to FCC licenses	(591)	(801)	(835)
Acquisitions, net of cash acquired	(560)	0	(287)
Proceeds from equity method investments	0	213	200
Investment in Clearwire	(1,118)	0	0
Proceeds from sales and maturities of short-term investments	573	204	15
Purchases of short-term investments	(650)	(51)	(194)
Cash collateral for securities loan agreements	0	0	866
Other, net	105	67	180
Net cash used in investing activities	(3,844)	(4,250)	(6,377)
Cash flows from financing activities
Proceeds from debt and financings	1,303	3,826	7,508
Repayments of debt and capital lease obligations	(2,226)	(4,367)	(7,535)
Payments of securities loan agreements	0	0	(866)
Proceeds from issuance of common shares, net	4	57	344
Purchase of common shares	0	0	(1,833)
Dividends paid	0	0	(286)
Net cash used in financing activities	(919)	(484)	(2,668)
Net increase in cash and cash equivalents	128	1,445	200
Cash and cash equivalents, beginning of year	3,691	2,246	2,046
Cash and cash equivalents, end of year	$3,819	$3,691	$2,246

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Millions			Paid-in Capital			(Accumulated Deficit)/ Retained Earnings		Accumulated Other Comprehensive Loss	Total
Beginning Balance at Dec. 31, 2006	$5,902		$46,682	[3]	($925)	$1,930	[3]	($148)	$53,441
Beginning Balance (in shares) at Dec. 31, 2006	2,951	[2]			54
Comprehensive loss
Net loss						(29,444)	[3]		(29,444)
Other comprehensive income (loss), net of tax
Other comprehensive income (loss)								37	37
Adoption of FIN 48						4	[3]		4
Issuance of common shares, net (in shares)					(35)
Issuance of common shares, net			(36)	[3]	597	(102)	[3]		459
Purchase of common shares (in shares)					87
Purchase of common shares					(1,833)				(1,833)
Common shares dividends						(286)	[3]		(286)
Share-based compensation expense			263	[3]					263
Investment dilution due to affiliate equity issuances, net			(213)	[3]					(213)
Other, net			15	[3]		2	[3]		17
Ending Balance (in shares) at Dec. 31, 2007	2,951	[2]			106
Ending Balance at Dec. 31, 2007	5,902		46,711	[3]	(2,161)	(27,896)	[3]	(111)	22,445
Comprehensive loss
Net loss						(2,796)	[3]		(2,796)
Other comprehensive income (loss), net of tax
Other comprehensive income (loss)								(413)	(413)
Issuance of common shares, net (in shares)					(12)
Issuance of common shares, net			5	[3]	218	(164)	[3]		59
Gain on deconsolidation of net assets contributed to Clearwire			424	[1],[3]					424	[1]
Share-based compensation expense			257	[3]					257
Other, net			(65)	[3]	4				(61)
Ending Balance (in shares) at Dec. 31, 2008	2,951	[2]			94
Ending Balance at Dec. 31, 2008	5,902		47,332	[3]	(1,939)	(30,856)	[3]	(524)	19,915
Comprehensive loss
Net loss						(2,436)	[3]		(2,436)
Other comprehensive income (loss), net of tax
Other comprehensive income (loss)								172	172
Issuance of common shares, net (in shares)					(20)
Issuance of common shares, net					491	(487)	[3]		4
Share-based compensation expense			78	[3]					78
Conversion of series 2 to series 1 common shares (in shares)	(40)	[2]			(40)
Conversion of series 2 to series 1 common shares	(80)		(785)	[3]	865				0
Equity consideration related to Virgin Mobile acquisition (in shares)	96	[2]
Equity consideration related to Virgin Mobile acquisition	193		186	[3]					379
Other, net			(18)	[3]	1				(17)
Ending Balance (in shares) at Dec. 31, 2009	3,007	[2]			34
Ending Balance at Dec. 31, 2009	$6,015		$46,793	[3]	($582)	($33,779)	[3]	($352)	$18,095
[1]On November 28, 2008, we recorded a $424 million gain on the deconsolidation of net assets contributed to Clearwire, net of $260 million in related taxes. See note 4 for details of this transaction.
[2]See note 14 for information regarding common shares.
[3]We made an immaterial correction to previously reported shareholders' equity. Paid-in Capital and (Accumulated Deficit)/Retained Earnings as of December 31, 2006 has been adjusted by $18 million and $292 million, respectively, related to a reduction in deferred tax liabilities. In completing a detailed reconciliation of the net deferred tax liabilities in 2009, it was determined the net deferred tax liabilities were overstated by $310 million.

2_Statement Of Shareholders Equ

Statement Of Shareholders Equity And Other Comprehensive Income (Parenthetical) (USD $)
In Millions	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2006
Gain on the deconsolidation of net assets contributed to Clearwire, related taxes		$260
Paid-in Capital, increase related to a reduction in deferred tax liabilities			18
(Accumulated Deficit)/Retained Earnings, increase related to a reduction in deferred tax liabilities			292
Paid-in Capital, overstated deferred tax liabilities attributable to periods prior to 2007	18
(Accumulated Deficit)/Retained Earnings, overstated deferred tax liabilities attributable to periods prior to 2007	$292

Description of Operations

Description of Operations
	12 Months Ended Dec. 31, 2009 USD / shares
Description of Operations	Note1. Description of Operations Sprint Nextel Corporation and its subsidiaries (Sprint, we, us, our or the Company) is a communications company offering a comprehensive range of wireless and wireline communications products and services that are designed to meet the needs of individual consumers, businesses, government subscribers and resellers. We have organized our operations to meet the needs of our targeted subscriber groups through focused communications solutions that incorporate the capabilities of our wireless and wireline services. As a result of the acquisition of Virgin Mobile USA, Inc. (VMU) on November24,2009 and iPCS, Inc. (iPCS) on December4, 2009 (See Note 3), the operations of VMU and iPCS are consolidated prospectively from their respective acquisition dates. The Wireless segment includes retail and wholesale revenue from a wide array of wireless mobile telephone and wireless data transmission services and the sale of wireless devices and accessories in the U.S., Puerto Rico and the U.S.Virgin Islands. The wireline segment includes revenue from domestic and international wireline voice and data communication services, including services to the cable multiple systems operators that resell our local and long distance service and use our back office systems and network assets in support of their telephone services provided over cable facilities. Sprints fourth generation (4G)technology capabilities exist through our mobile virtual network operator (MVNO) relationship with and 56% ownership interests in Clearwire Corporation and its consolidated subsidiary, Clearwire Communications LLC (together, Clearwire). Clearwire is deploying Worldwide Interoperability for Microwave Access (WiMAX) technology as a new network in markets that we serve. The services supported by this technology gives subscribers with compatible devices high-speed access to the Internet and a variety of increasingly sophisticated data services (See Note 4).

Summary of Significant Accounti

Summary of Significant Accounting Policies and Other Information
	12 Months Ended Dec. 31, 2009 USD / shares
Summary of Significant Accounting Policies and Other Information	Note2. Summary of Significant Accounting Policies and Other Information Consolidation Policies and Estimates The consolidated financial statements include our accounts, those of our wholly owned subsidiaries, and subsidiaries we control or in which we have a controlling financial interest. All significant intercompany transactions and balances have been eliminated in consolidation. Investments where Sprint maintains majority ownership, but lacks full decision making ability over all major issues, are accounted for using the equity method. Governance for Sprints major unconsolidated investment in Clearwire is based on our Board representation for which Sprint does not maintain majority vote or the ability to control operating and financial policies. The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (GAAP). This requires management of the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements. These estimates are inherently subject to judgment and actual results could differ. Certain prior period amounts have been reclassified to conform to the current period presentation. Subsequent events were evaluated for disclosure through the date on which the financial statements were filed with the Securities and Exchange Commission. Summary of Significant Accounting Policies Cash and Cash Equivalents Cash equivalents generally include highly liquid investments with maturities at the time of purchase of three months or less. These investments include money market funds, certificates of deposit, U.S. government and government-sponsored debt securities, corporate debt securities, municipal securities, bank-related securities, and credit and debit card transactions in process. Allowance for Doubtful Accounts An allowance for doubtful accounts is established sufficient to cover probable and reasonably estimable losses. Because of the number of subscriber accounts, it is not practical to review the collectibility of each of those accounts individually to determine the amount of allowance for doubtful accounts each period, although some account level analysis is performed with respect to large wireless and wireline subscribers. The estimate of allowance for doubtful accounts considers a number of factors, including collection experience, aging of the accounts receivable portfolios, credit quality of the subscriber base, estimated proceeds from future bad debt sales and other qualitative considerations, including macro-economic factors. Amounts written off against the allowance for doubtful accounts, net of recoveries, were $487 million, $826 million, and $952 million in 2009, 2008 and 2007, respectively. Device and Accessory Inventory Inventories are stated at the lower of cost or market. Cost is determined by the first-in, first-out (FIFO) method. Costs of devices and related revenues generated from device sales (equipment net subsidy) are recognized at the time of

Acquisitions

Acquisitions
	12 Months Ended Dec. 31, 2009 USD / shares
Acquisitions	Note3. Acquisitions During the fourth quarter 2009, we completed the acquisitions of Virgin Mobile USA, Inc. and iPCS, Inc. (together, Acquisitions) within our Wireless segment. The consideration paid for each of the acquired entities has been allocated to the assets acquired and liabilities assumed based on their estimated fair values at the respective acquisition dates. The excess of consideration paid over net tangible and identifiable intangible assets is recognized as goodwill. As a result of these Acquisitions, Sprint recognized $373 million of goodwill representing our balance as of December31, 2009. The purchase price allocation used in the preparation of these financial statements is preliminary due to the continuing analyses relating to the determination of the estimated fair values of the assets acquired and liabilities assumed. Any changes to the valuation of net assets acquired, based on information as of the acquisition date, will result in an adjustment to the estimated fair value of the assets acquired and liabilities assumed and a corresponding adjustment to goodwill. Management does not expect the finalization of these matters to have a material effect on the allocation. Goodwill recognized in connection with the Acquisitions is not deductible for tax purposes. The results of operations for each acquired entity are included in Sprints consolidated results of operations prospectively from the respective date of each acquisition. The estimated fair values of the assets acquired and liabilities assumed were preliminarily determined using the income, cost or market approaches. The fair value measurements were primarily based on significant inputs that are not observable in the market, other than long-term debt assumed in the acquisition of iPCS. Discounted cash flows, an income approach, were primarily used to value the identifiable intangible assets, consisting primarily of customer relationships, reacquired rights and the Virgin Mobile trademark, as well as the effective settlement of litigation. Depreciated replacement cost, a cost approach, was used to estimate the fair value of property, plant and equipment. In accordance with the recently adopted guidance on accounting for business combinations, Sprint measured 100% of the acquirees assets and liabilities at fair value, including the non-controlling interest in VMU held by Sprint prior to the acquisition. Sprints previously held non-controlling interest in VMU was valued based on a market approach considering the amounts paid to acquire the remaining 85.9% ownership in VMU. VMU and iPCS Acquisitions On November24, 2009 we completed the acquisition of the remaining 85.9% of VMU, a national provider of predominantly prepaid wireless communications services, in a cash and stock business combination, to, among other things, broaden the Companys position in the prepaid wireless market. The aggregate consideration, including the fair value of Sprints non-controlling interest in VMU, was $701 million consisting of 96.2million shares of Sprint common stock valued at $361 million, share-based consideration of $18 million and $265 million in net cash. The value of

Investments

Investments
	12 Months Ended Dec. 31, 2009 USD / shares
Investments	Note4. Investments December31, 2009 2008 (in millions) Marketable equity securities $ 43 $ 37 Equity method and other investments 4,581 4,204 $ 4,624 $ 4,241 Marketable equity securities Investments in marketable equity securities are recognized at fair value and are considered available-for-sale securities. Accordingly, unrealized holding gains and losses on these securities are recognized in accumulated other comprehensive income (loss), net of related income tax. Realized gains or losses are measured and reclassified from accumulated other comprehensive income (loss) into earnings based on identifying the specific investments sold or where an other-than-temporary impairment exists. Gross unrealized holding gains and losses were insignificant for 2009 and 2008. Equity Method Investment in Clearwire Clearwire In November 2008, we closed a transaction with Clearwire to combine our next-generation wireless broadband businesses. At closing, Sprint contributed assets with a carrying value of $3.3 billion, including our 2.5 gigahertz (GHz) spectrum and WiMAX related assets which, together with Clearwires existing business and cash contributions from other investors, is being used to build and operate a next-generation wireless broadband network that will provide entire communities with high-speed residential and mobile internet access services and residential voice services. As part of the arrangement, we entered into various agreements with Clearwire, including MVNO agreements under which Clearwire can purchase 3G CDMA, mobile voice and data communication services from Sprint for resale to end users and Sprint can purchase 4G wireless broadband services for resale to our end users. Amounts under these agreements were not yet material during 2009 as Clearwire continues the build-out of its 4G network. In conjunction with the transaction, Clearwire agreed to reimburse Sprint for certain cash expenditures incurred prior to the closing of the transaction in the amount of $388 million. Approximately $213 million was paid by Clearwire during 2008 and the remaining $175 million was provided through a variable interest bearing note, maturing in May 2011, which is included in equity method and other investments. This reimbursement was accounted for as a reduction to the initial investment in Clearwire. Also, during the quarter ended December31, 2008, we recognized a pre-tax gain within shareholders equity of $684 million ($424 million after tax) related to the difference between our share of Clearwires net assets upon close and the carrying value of the net assets we contributed to Clearwire. Equity in losses of Clearwire was $803 million for the year ended December31, 2009, which represents our proportionate share of Clearwires net loss of $649 million and a pre-tax loss of $154 million ($96 million after tax) representing the finalization of ownership percentages, which was subject to change based on the trading price of Clearwire stock during the 90 days subsequent to close. On November9, 2009, Sprint, in addition to other investors, en

Financial Instruments

Financial Instruments
	12 Months Ended Dec. 31, 2009 USD / shares
Financial Instruments	Note5. Financial Instruments Cash and cash equivalents, accounts and notes receivable, and accounts payable are carried at cost which approximates fair value and, as such, are not included in the table below. Short-term investments (consisting primarily of time deposits and treasury securities) and marketable equity securities are measured on a recurring basis at amounts which approximate fair value. Any changes in fair value of assets or liabilities carried at fair value are recognized in other comprehensive income (loss) each period. The following table presents information regarding the method of valuation bases for assets and liabilities measured at fair value on a recurring basis as of December31, 2009: QuotedPricesin ActiveMarketsfor Identical Assets Significant OtherObservable Inputs Unobservable Inputs Balance December31, 2009 (in millions) Short-term investments $ 105 $ $ $ 105 Marketable equity securities 43 43 $ 148 $ $ $ 148 The estimated fair value of long-term debt, financing and capital lease obligations, including current maturities is based on current market prices or interest rates. The following table presents carrying amounts and estimated fair values for these financial instruments: December31, 2009 2008 Carrying Amount Estimated FairValue Carrying Amount Estimated FairValue (in millions) Long-term debt, financing and capital lease obligations $ 21,061 $ 20,014 $ 21,610 $ 14,449

Property, Plant and Equipment

Property, Plant and Equipment
	12 Months Ended Dec. 31, 2009 USD / shares
Property, Plant and Equipment	Note6. Property, Plant and Equipment Network equipment, site costs and related software includes switching equipment, cell site towers, site development costs, radio frequency equipment, network software, digital fiber optic cable, transport facilities and transmission-related equipment. Buildings and improvements principally consists of owned general office facilities, retail stores and leasehold improvements. Non-network internal use software, office equipment and other primarily consists of furniture, information technology systems and equipment and vehicles. Construction in progress, which is not depreciated until placed in service, primarily includes materials, transmission and related equipment, labor, engineering, site development costs, interest and other costs relating to the construction and development of our network. Interest incurred in connection with the construction of long-lived assets totaled $12million, $123million and $127million for the years ended December31, 2009, 2008 and 2007, respectively. The components of property, plant and equipment, and the related accumulated depreciation were as follows: December31, 2009 December31, 2008 (in millions) Land $ 332 $ 328 Network equipment, site costs and related software 36,992 38,273 Buildings and improvements 4,792 4,757 Non-network internal use software, office equipment and other 2,966 3,268 Construction in progress 1,111 1,840 Less accumulated depreciation (27,913 ) (26,093 ) Property, plant and equipment, net $ 18,280 $ 22,373

Intangible Assets

Intangible Assets
	12 Months Ended Dec. 31, 2009 USD / shares
Intangible Assets	Note7. Intangible Assets Indefinite-Lived Intangibles December31, 2007 Goodwill Impairment, Adjustments Other December31, 2008 Net Additions December31, 2009 (in millions) FCC licenses(1) $ 20,707 $ (1,796 ) $ 18,911 $ 591 $ 19,502 Trademarks 416 (7 ) 409 409 Goodwill(2) 978 (978 ) 373 373 $ 22,101 $ (2,781 ) $ 19,320 $ 964 $ 20,284 (1) During 2008, we contributed $2.5 billion of FCC licenses to Clearwire and acquired $1.0 billion of FCC licenses in our normal course of business, including our requirements under the Report and Order. In addition, we reduced FCC licenses by $265 million due to the reversal of unrecognized tax benefits. See note 11 for additional information. (2) During 2009, we recognized goodwill of $373 million associated with the acquisitions of VMU and iPCS (see Note 3). We hold FCC licenses authorizing the use of radio frequency spectrum to deploy our wireless services: 1.9 GHz licenses utilized in the CDMA network, and 800 megahertz (MHz) and 900MHz licenses utilized in the iDEN network. We also hold 1.9GHz and other FCC licenses that are not currently being utilized. As long as the Company acts within the requirements and constraints of the regulatory authorities, the renewal and extension of these licenses is reasonably certain at minimal cost. We are not aware of any technology being developed that would render this spectrum obsolete and have concluded that these licenses are indefinite-lived intangible assets. Our Sprint and Boost Mobile trademarks have been identified as indefinite-lived intangible assets. Goodwill Goodwill represents the excess of consideration paid over the estimated fair value of net tangible and identifiable intangible assets acquired in business combinations. During the fourth quarter 2009, we acquired VMU and iPCS (see Note 3) and, based on our preliminary purchase price allocation, recorded $373 million of goodwill. Goodwill Recoverability Assessment The carrying value of Sprints goodwill is included in the Wireless segment which represents our wireless reporting unit. We estimate the fair value of the wireless reporting unit using discounted expected future cash flows, supported by the results of market approach valuation models. If the fair value of the wireless reporting unit exceeds its net book value, goodwill is not impaired, and no further testing is necessary. If the net book value of our wireless reporting unit exceeds its estimated fair value, we estimate the fair value of goodwill to determine the amount of impairment loss, if any. The determination of the estimated fair value of the wireless reporting unit and other assets and liabilities within the wireless reporting unit requires significant estimates and assumptions. These estimates and assumptions primarily include, but are not limited to, discount rate, terminal growth rate, operating income before depreciation and amortization (OIBDA) and capital expenditure forecasts. Due to the inher

Long-Term Debt, Financing and C

Long-Term Debt, Financing and Capital Lease Obligations
	12 Months Ended Dec. 31, 2009 USD / shares
Long-Term Debt, Financing and Capital Lease Obligations	Note8. Long-Term Debt, Financing and Capital Lease Obligations Interest Rates Maturities December31, 2009 December31, 2008 (in millions) Notes Senior notes Sprint Nextel Corporation 0.659.25% 20102022 $ 4,250 $ 2,950 Sprint Capital Corporation 6.888.75% 20112032 9,854 10,454 Convertible senior notes Nextel Communications, Inc. 5.25% 2010 607 Serial redeemable senior notes Nextel Communications, Inc. 5.957.38% 20132015 4,780 4,780 Secured Notes iPCS, Inc. 2.414.28% 20132014 479 Credit facilities Sprint Nextel Corporation Bank credit facility 3.00% 2010 1,000 Export Development Canada 3.39% 2012 750 750 Financing obligation 9.50% 2030 698 698 Capital lease obligations and other(1) 4.1115.49% 20102022 190 204 Net premiums 60 167 21,061 21,610 Less current portion (768 ) (618 ) Long-term debt, financing and capital lease obligations $ 20,293 $ 20,992 (1) Includes $105 million in outstanding principal related to a consolidated variable interest entity. As of December31, 2009, Sprint Nextel Corporation, the parent corporation, had $5.0billion in principal of debt outstanding, including the credit facilities. In addition, $14.6 billion in principal of our long-term debt issued by wholly-owned subsidiaries is guaranteed by the parent, of which approximately $9.9 billion issued by our finance subsidiary, Sprint Capital Corporation, is fully and unconditionally guaranteed. The indentures and financing arrangements of certain subsidiaries debt contain provisions that limit cash dividend payments on subsidiary common stock. The transfer of cash in the form of advances from the subsidiaries to the parent corporation generally is not restricted. As of December31, 2009, about $1.4billion of our outstanding debt, comprised of certain secured notes, financing and capital lease obligations and mortgages, is secured by $1.2billion of gross property, plant and equipment and other assets. Cash interest payments were $1.4billion, $1.4billion and $1.5 billion during each of the years ended December31, 2009, 2008 and 2007. Notes Notes consist of senior and serial redeemable senior notes that are unsecured and secured notes of iPCS, which are secured solely with the underlying assets of iPCS. Cash interest on these notes is generally payable semiannually in arrears. Approximately $18.4 billion of the notes are redeemable at the Companys discretion including accrued interest. Our weighted average effective interest rate related to our senior notes was 6.5% in 2009 and 2008. In December 2009, the Company assumed $417 million (net of a $62 million discount) of Secured Floating Rate Notes due in 2013 and 2014 as part of the acquisition of iPCS. The Company may redeem som

Severance, Exit Costs and Asset

Severance, Exit Costs and Asset Impairments
	12 Months Ended Dec. 31, 2009 USD / shares
Severance, Exit Costs and Asset Impairments	Note9. Severance, Exit Costs and Asset Impairments Liabilities for severance and exit costs are recognized based upon the nature of the cost to be incurred. For involuntary separation plans that are completed within the guidelines of our written involuntary separation plan, a liability is recognized when it is probable and reasonably estimable. For voluntary separation plans (VSP) a liability is recognized when the VSP is irrevocably accepted by the employee. For one-time termination benefits, such as additional severance pay or benefit payouts, and other exit costs, such as lease termination costs, the liability is measured and recognized initially at fair value in the period in which the liability is incurred, with subsequent changes to the liability recognized as adjustments in the period of change. Severance and exit costs associated with business combinations were recorded as a component of the purchase price allocation in periods prior to 2009, generally resulting in additional goodwill. Beginning in 2009, in conjunction with recently adopted guidance on accounting for business combinations, the Company records severance and exit costs associated with business combinations in the results of operations when incurred. Severance and Exit Costs Activity During 2009, we recognized $400 million of severance and exit costs related primarily to the reduction in workforce announcements in 2009. Of these amounts, $307 million related to the Wireless segment and $93 million related to the Wireline segment. During 2008, we recognized $355 million of severance and exit costs related to the separation of employees and continued organizational realignment initiatives. Of these amounts, $270 million related to our Wireless segment, $62 million related to our Wireline segment and the remaining $23 million related to Corporate and other. In 2007 we recognized $230million and $47 million of expenses for severance and exit costs related to our Wireless and Wireline segments, respectively. The following provide the activity in the severance and exit costs liability, included in Accrued expenses and other current liabilities. 2009 Activity December31, 2008 Net Expense CashPayments andOther December31, 2009 (in millions) Exit costs $ 113 $ 38 $ (62 ) $ 89 Severance 90 362 (342 ) 110 Total costs $ 203 $ 400 $ (404 ) $ 199 2008 Activity December31, 2007 Net Expense CashPayments andOther December31, 2008 (in millions) Exit costs $ 118 $ 42 $ (47 ) $ 113 Severance 32 313 (255 ) 90 Total costs $ 150 $ 355 $ (302 ) $ 203 2007 Activity December31, 2006 Net Expense CashPayments andOther December31, 2007 (in millions) Exit costs $ 160 $ 83 $ (125 ) $ 118 Severance 62 194 (224 ) 32 Total costs $ 222 $ 277 $ (349 ) $ 150

Supplemental Financial Informat

Supplemental Financial Information
	12 Months Ended Dec. 31, 2009 USD / shares
Supplemental Financial Information	Note10. Supplemental Financial Information December31, 2009 2008 (in millions) Accounts and notes receivable, net Trade $ 2,839 $ 3,165 Unbilled trade and other 363 472 Less allowance for doubtful accounts (206 ) (276 ) $ 2,996 $ 3,361 Prepaid expenses and other current assets Prepaid expenses $ 432 $ 380 Deferred charges and other 318 263 $ 750 $ 643 Accounts payable(1) Trade $ 1,575 $ 1,574 Accrued interconnection costs 465 391 Construction obligations and other 227 173 $ 2,267 $ 2,138 Accrued expenses and other current liabilities Deferred revenues $ 1,270 $ 1,139 Accrued taxes 388 438 Payroll and related 481 402 Accrued interest 405 384 Other 1,206 1,162 $ 3,750 $ 3,525 Other liabilities Deferred rental incomecommunications towers $ 824 $ 864 Deferred rent 1,257 1,213 Accrued taxesunrecognized tax benefits 176 345 Deferred revenue 204 207 Post-retirement benefits and other non-current employee related liabilities 525 913 Other 572 636 $ 3,558 $ 4,178 (1) Includes liabilities in the amounts of $150 million and $153 million as of December31, 2009 and 2008, respectively, for checks issued in excess of associated bank balances but not yet presented for collection.

Income Taxes

Income Taxes
	12 Months Ended Dec. 31, 2009 USD / shares
Income Taxes	Note11. Income Taxes Income tax benefit (expense) consists of the following: YearEndedDecember31, 2009 2008 2007 (in millions) Current income tax benefit (expense) Federal $ 279 $ 17 $ 15 State 13 (15 ) (7 ) Total current income tax benefit 292 2 8 Deferred income tax benefit (expense) Federal 963 1,110 84 State (196 ) 153 242 Total deferred income tax benefit 767 1,263 326 Foreign income tax expense (1 ) (1 ) (3 ) Total income tax benefit $ 1,058 $ 1,264 $ 331 The differences that caused our effective income tax rates to vary from the 35% federal statutory rate for income taxes were as follows: Year Ended December31, 2009 2008 2007 (in millions) Income tax benefit at the federal statutory rate $ 1,223 $ 1,421 $ 10,421 Effect of: Goodwill impairment (278 ) (10,237 ) State income taxes, net of federal income tax effect 93 96 48 State law changes, net of federal income tax effect (6 ) 32 105 Reduction in liability for unrecognized tax benefits 83 Tax expense related to equity awards (33 ) Change in valuation allowance (281 ) (38 ) Other, net (21 ) 31 (6 ) Income tax benefit $ 1,058 $ 1,264 $ 331 Effective income tax rate 30.3 % 31.1 % 1.1 % Income tax benefit (expense) allocated to other items was as follows: YearEndedDecember31, 2009 2008 2007 (in millions) Unrecognized net periodic pension and postretirement benefit cost(1) $ (87 ) $ 234 $ (10 ) Unrealized gains/losses on securities(1) (9 ) 11 (3 ) Stock ownership, purchase and option arrangements(2) (56 ) (64 ) (15 ) Gain on deconsolidation of net assets contributed to Clearwire(2) (260 ) Goodwill, reduction of valuation allowance on acquired assets 93 Identifiable intangible assets 190 (1) These amounts have been recorded directly to shareholders equityaccumulated other comprehensive loss on the consolidated balance sheets. (2) These amounts have been recorded directly to shareholders equitypaid-in capital on the consolidated balance sheets. We recognize deferred income taxes for the temporary differences between the carrying amounts of our assets and liabilities for financial statement purposes and their tax bases. Deferred tax assets are also recorded for operating loss, capital loss and tax credit carryforwards. The sources of the differences that give rise to the deferred income tax assets and

Commitments and Contingencies

Commitments and Contingencies
	12 Months Ended Dec. 31, 2009 USD / shares
Commitments and Contingencies	Note12. Commitments and Contingencies Litigation, Claims and Assessments A number of cases that allege Sprint Communications Company L.P. failed to obtain easements from property owners during the installation of its fiber optic network in the 1980s have been filed in various courts. Several of these cases sought certification of nationwide classes, and in one case, a nationwide class was certified. In 2003, a nationwide settlement of these claims was approved by the U.S. District Court for the Northern District of Illinois, but objectors appealed the preliminary approval order to the Seventh Circuit Court of Appeals, which overturned the settlement and remanded the case to the trial court for further proceedings. The parties proceeded with litigation and/or settlement negotiations on a state by state basis, and settlement negotiations have been coordinated in all cases but those pending in Louisiana and Tennessee. The Louisiana claims have been separately settled for an amount not material to our consolidated financial position or results of operations, and that settlement was given final approval by the Court, and the time to appeal that approval has expired. We reached an agreement in principle to settle the claims in all the other states, excluding Tennessee, for an amount not material to our consolidated financial position or results of operations. The Court issued its preliminary approval of the settlement on July17, 2008, but on September10, 2009, the Court announced that it would not approve the settlement. The Court did not decide whether the settlement was fair or in the best interest of class members, but denied on jurisdictional grounds. As a result, the agreement terminated, and the Company continues to defend the matters vigorously. We do not expect the resolution of this matter to have a material effect on our consolidated financial position or results of operations. In September 2004, the U.S.District Court for the District of Kansas denied a motion to dismiss a shareholder lawsuit alleging that our 2001 and 2002 proxy statements were false and misleading in violation of federal securities laws to the extent they described new employment agreements with certain senior executives without disclosing that, according to the allegations, replacement of those executives was inevitable. These allegations, made in an amended complaint in a lawsuit originally filed in 2003, are asserted against us and certain former officers and directors, and seek to recover any decline in the value of our tracking stocks during the class period. The parties have stipulated that the case can proceed as a class action. All defendants have denied plaintiffs allegations and intend to defend this matter vigorously. Allegations in the original complaint, which asserted claims against the same defendants and our former independent auditor, were dismissed by the Court in April 2004. Our motion to dismiss the amended complaint was denied, and the parties are engaged in discovery. We do not expect the resolution of this matter to have a material effect on our consolidated financial position or results of operations. Various other suits, proce

Compensation Plans

Compensation Plans
	12 Months Ended Dec. 31, 2009 USD / shares
Compensation Plans	Note13. Compensation Plans As of December31, 2009, Sprint sponsored four incentive plans: the 2007 Omnibus Incentive Plan (2007 Plan); the 1997 Long-Term Incentive Program (1997 Program); the Nextel Incentive Equity Plan (Nextel Plan) and the Management Incentive Stock Option Plan (MISOP). Sprint also sponsors an Employee Stock Purchase Plan (ESPP). Under the 2007 Plan, we may grant share and non-share based awards, including stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units and other equity-based and cash awards to employees, outside directors and certain other service providers. Options are generally granted with an exercise price equal to the market value of the underlying shares on the grant date, generally vest on an annual basis over three or four years, and generally have a contractual term of ten years. Employees and directors who are granted restricted stock units are not required to pay for the shares but generally must remain employed with us, or continue to serve as a member of our board of directors, until the restrictions lapse, which is typically three years for employees and one year for directors. The Compensation Committee of our board of directors, or one or more executive officers should the Compensation Committee so authorize, as provided in the 2007 Plan, will determine the terms of each equity-based award. No new grants can be made under the 1997 Program, the Nextel Plan or the MISOP. During 2009, the number of shares available under the 2007 Plan increased by about 51million to approximately 174million common shares, as the number of shares available under the 2007 Plan is increased by any shares originally granted under the 1997 Program, the Nextel Plan or the MISOP that are forfeited, expired, or otherwise terminated. As of December31, 2009, restricted stock units and options to acquire about 50million shares were outstanding under the 2007 Plan, restricted stock units and options to acquire about 39million shares were outstanding under the 1997 Program, options to acquire about 18million shares were outstanding under the Nextel Plan and options to acquire about 18million common shares were outstanding under the MISOP. Restricted stock units granted in 2008 and 2007 generally have both performance and service requirements with vesting periods ranging from one to three years. Furthermore, restricted stock units awarded after the second quarter 2008 through the first quarter 2009 included quarterly performance targets. These awards, however, were not granted until after the performance targets had been met. Therefore, at the grant date these awards only had a remaining service requirement and vested six months following the last day of the applicable quarter. In the fourth quarter 2009, approximately 1million restricted stock units were granted with service requirements only and graded vesting over a period of two or three years. Under the Nextel Plan, outstanding Nextel deferred shares, or nonvested shares, which constitute an agreement to deliver shares upon the performance of service over a defined period of time, and grants o

Shareholders' Equity and Per Sh

Shareholders' Equity and Per Share Data
	12 Months Ended Dec. 31, 2009 USD / shares
Shareholders' Equity and Per Share Data	Note14. Shareholders Equity and Per Share Data Our articles of incorporation authorize 6,620,000,000 shares of capital stock as follows: 6,000,000,000 shares of Series 1 voting common stock, par value $2.00 per share; 500,000,000 shares of Series 2 voting common stock, par value $2.00 per share; 100,000,000 shares of non-voting common stock, par value $0.01 per share; and 20,000,000 shares of preferred stock, no par value per share. Classes of Common Stock Series 1 Common Stock The holders of our Series 1 common stock are entitled to one vote per share on all matters submitted for action by the shareholders. There were about 3.0billion shares of Series 1 common stock outstanding as of December31, 2009. Series 2 Common Stock The holders of our Series 2 common stock are entitled to 10% of one vote per share, but otherwise have rights that are substantially identical to those of the Series 1 common stock. There were about 35million shares of Series 2 common stock outstanding as of December31, 2009. In 2009, certain holders of our Series 2 common stock exercised their rights to convert 39.8million Series 2 shares to 39.8million Series 1 shares, resulting in a $80 million and $785 million reduction to common shares and paid in capital, respectively, and a corresponding $865 million reduction in treasury shares. Treasury Shares Shares of common stock repurchased by us are recorded at cost as treasury shares and result in a reduction of shareholders equity. We reissue treasury shares as part of our shareholder approved stock-based compensation programs, as well as upon conversion of outstanding securities that are convertible into common stock. When shares are reissued, we determine the cost using the FIFO method. Dividends We did not declare any dividends on our common shares in 2009 or 2008. We declared and paid a dividend of $0.025 per share on the Series 1 common stock and the Series 2 common stock in each of the quarters of 2007. We are currently restricted from paying cash dividends by the terms of our revolving bank credit facility as described in Note 8. Share Repurchase Program On July25, 2006, our board of directors authorized a program for the purchase of up to $6.0billion of our Series1 common stock through open market purchases. We repurchased 185million shares of our Series1 common stock for $3.5billion at an average price of $18.77 per share through 2007. The program expired in January 2008 and no additional repurchases were made. Common Stock Reserved for Future Grants As of December31, 2009, Series1 common stock reserved for future grants under plans providing for the grant of stock options and other equity-based awards, future grants under the employees stock purchase plan or future issuances under various other arrangements included: Shares (inmillions) Employees stock purchase plan 85 Officer and key employees and directors stock options and other equity-based awards 174 259 Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss are as follows:

Segments

Segments
	12 Months Ended Dec. 31, 2009 USD / shares
Segments	Note15. Segments Sprint operates two reportable segments: Wireless and Wireline. Wireless primarily includes retail and wholesale revenue from a wide array of wireless mobile telephone and wireless data transmission services and the sale of wireless devices and accessories in the U.S., Puerto Rico and the U.S.Virgin Islands. Wireline primarily includes revenue from domestic and international wireline voice and data communication services, including services to the cable multiple systems operators that resell our local and long distance service and use our back office systems and network assets in support of their telephone services provided over cable facilities. We define segment earnings as wireless or wireline operating (loss) income before other segment expenses such as depreciation, amortization, severance, exit costs, goodwill and asset impairments, other and merger and integration expenses solely and directly attributable to the segment. Expenses and income items excluded from segment earnings are managed at the corporate level. Transactions between segments are generally accounted for based on market rates which we believe approximate fair value. Segment financial information is as follows: Statement of Operations Information Wireless Wireline Corporate, Other and Eliminations Consolidated (in millions) 2009 Net operating revenues $ 27,786 $ 4,471 $ 3 $ 32,260 Inter-segment revenues(1) 1,158 (1,158 ) Total segment operating expenses (22,588 ) (4,408 ) 1,143 (25,853 ) Segment earnings $ 5,198 $ 1,221 $ (12 ) 6,407 Less: Depreciation and amortization (7,416 ) Other, net(2) (389 ) Operating loss (1,398 ) Interest expense (1,450 ) Equity in losses of unconsolidated investments, net $ (803 ) (803 ) Other income, net 157 Loss before income taxes $ (3,494 ) Statement of Operations Information Wireless Wireline Corporate, Other and Eliminations Consolidated (in millions) 2008 Net operating revenues $ 30,427 $ 5,208 $ $ 35,635 Inter-segment revenues(1) 1,124 (1,124 ) Total segment operating expenses(3) (23,651 ) (5,157 ) 837 (27,971 ) Segment earnings $ 6,776 $ 1,175 $ (287 ) 7,664 Less: Depreciation and amortization (8,407 ) Goodwill impairment (963 ) Other, net(2) (936 ) Operating loss

Quarterly Financial Data

Quarterly Financial Data (Unaudited)
	12 Months Ended Dec. 31, 2009 USD / shares
Quarterly Financial Data (Unaudited)	Note16. Quarterly Financial Data (Unaudited) Quarter 1st 2nd 3rd 4th (in millions, except per share amounts) 2009 Net operating revenues $ 8,209 $ 8,141 $ 8,042 $ 7,868 Operating loss (487 ) (113 ) (254 ) (544 ) Net loss(1) (594 ) (384 ) (478 ) (980 ) Basic and diluted loss per common share(2) (0.21 ) (0.13 ) (0.17 ) (0.34 ) Quarter 1st 2nd 3rd 4th (in millions, except per share amounts) 2008 Net operating revenues $ 9,334 $ 9,055 $ 8,816 $ 8,430 Operating loss(3) (498 ) (210 ) (205 ) (1,729 ) Net loss(3) (505 ) (344 ) (326 ) (1,621 ) Basic and diluted loss per common share (2) (0.18 ) (0.12 ) (0.11 ) (0.57 ) (1) In the first quarter 2009, we recorded a $154 million non-cash loss representing the finalization of our ownership percentages in Clearwire. In the fourth quarter 2009, we recorded a non-cash gain of $151 million related to our non-controlling interest in VMU as well as an increase in our tax valuation allowance of $306 million. (2) The sum of the quarterly earnings per share amounts may not equal the annual amounts because of the changes in the weighted average number of shares outstanding during the year. (3) In the fourth quarter 2008, we performed our annual goodwill analysis and recorded a non-cash goodwill impairment charge of $963 million. In addition, we recorded asset impairments, gains on dispositions of assets and lease exit costs of $493 million.

Document Information

Document Information
	12 Months Ended Dec. 31, 2009 USD / shares
Document Type	10-K
Amendment Flag	false
Document Period End Date	2009-12-31

Entity Information

Entity Information (USD $)
	12 Months Ended Dec. 31, 2009	Feb. 19, 2010	Jun. 30, 2009
Trading Symbol	S
Entity Registrant Name	SPRINT NEXTEL CORP
Entity Central Index Key	0000101830
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		2,942,347,082
Entity Public Float			$13,800,465,103
Voting Common Stock Series 2
Entity Common Stock, Shares Outstanding		35,000,000