UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the quarterly period ended __________JUNE 30, 1997_________________________

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the transition period from ___________________to___________________________

333-06609-01
Commission file number ________________333-06609-02 ___________________________

SPRINT SPECTRUM L.P.
SPRINT SPECTRUM FINANCE CORPORATION __________________
(Exact name of registrant as specified in its charter)

DELAWARE 48-1165245
DELAWARE 43-1746537
(State or other jurisdiction of incorporation (IRS Employer
or organization) Identification No.)

4900 Main Street, Kansas City, Missouri, 64112
- --------------------------------------------------------------------------------
(Address of principal executive offices)

(816) 559-1000
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)

- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes X No

As of August 1, 1997, Sprint Spectrum Finance Corporation had Common Stock
outstanding of 100 shares.

- --------------------------------------------------------------------------------
SPRINT SPECTRUM L.P.
- --------------------------------------------------------------------------------
SPRINT SPECTRUM FINANCE CORPORATION
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1997

INDEX

Page
Number
---------------

Part I - Financial Information.................................... 1 - 11

Item 1a. Financial Statements - Sprint Spectrum L.P......... 1 - 3

Consolidated Condensed Balance Sheets.................... 1

Consolidated Condensed Statements of Operations.......... 2

Consolidated Condensed Statements of Cash Flows.......... 3

Notes to Consolidated Condensed Financial Statements..... 4 - 7

Item 1b. Financial Statements - Sprint Spectrum Finance
Corporation.............................................. 8 - 11

Condensed Balance Sheets................................. 8

Condensed Statements of Operations....................... 9

Condensed Statements of Cash Flows....................... 10

Notes to Condensed Financial Statements.................. 11

Item 2a. Management's Discussion and Analysis of Financial
Condition and Results of Operations - Sprint Spectrum L.P. 12 - 17

Item 2b. Management's Discussion and Analysis of Financial
Condition and Results of Operations - Sprint Spectrum
Finance Corporation...................................... 18

Part II - Other Information

Item 1. Legal Proceedings................................... 19

Item 2. Changes in Securities............................... 19

Item 3. Defaults On Senior Securities....................... 19

Item 4. Submission of Matters to a Vote of Security Holders.. 19

Item 5. Other Information.................................... 19

Item 6. Exhibits and Reports on Form 8-K..................... 19 - 20

Signature.......................................................... 21 - 22

Exhibits

PART I.
Item 1a.
SPRINT SPECTRUM L.P.
(A Development Stage Enterprise)
CONSOLIDATED CONDENSED BALANCE SHEETS
(In Thousands)

June 30, December 31,
1997 1996
- --------------------------------------------------------------------------------------------------------------------
(Unaudited)
ASSETS

CURRENT ASSETS:

Cash and cash equivalents...................................... $ 92,403 $ 49,988
Accounts receivable, net....................................... 24,449 3,310
Receivable from affiliates..................................... 22,423 14,021
Inventory...................................................... 84,238 72,414
Prepaid expenses and other assets.............................. 27,327 14,260
--------------- ----------------
Total current assets......................................... 250,840 153,993

INVESTMENT IN PCS LICENSES, net................................... 2,112,471 2,122,908

PROPERTY, PLANT AND EQUIPMENT, net................................ 2,524,899 1,408,680

MICROWAVE RELOCATION COSTS, net................................... 213,548 135,802

OTHER ASSETS...................................................... 88,189 77,383

================ ================
TOTAL ASSETS...................................................... $ 5,189,947 $ 3,898,766
================ ================

LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
Accounts payable............................................... $ 83,678 $ 196,146
Payable to affiliates.......................................... 849 5,626
Accrued expenses............................................... 167,893 59,200
Current maturities of long-term debt .......................... 5,038 5,049
--------------- ----------------
Total current liabilities................................... 257,458 266,021

LONG-TERM COMPENSATION OBLIGATION................................. 20,273 11,356

CONSTRUCTION OBLIGATIONS.......................................... 1,167,140 714,934

LONG TERM DEBT.................................................... 1,820,132 686,192

COMMITMENTS AND CONTINGENCIES

LIMITED PARTNER INTEREST IN CONSOLIDATED SUBSIDIARY............... 5,000 5,000

PARTNERS' CAPITAL AND ACCUMULATED DEFICIT:
Partners' capital.............................................. 2,948,793 2,767,564
Deficit accumulated during the development stage............... (1,028,849) (552,301)
--------------- ----------------
Total partners' capital...................................... 1,919,944 2,215,263

=============== ================
TOTAL LIABILITIES AND PARTNERS' CAPITAL........................... $ 5,189,947 $ 3,898,766
=============== ================

See notes to consolidated condensed financial statements.

PART I.
Item 1a.
SPRINT SPECTRUM L.P.
(A Development Stage Enterprise)
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Thousands)

Cumulative
Period from
October 24, 1994
(date of
Three Months Ended Six Months Ended inception) to
June 30, June 30, June 30,
--------------------------------- --------------------------------
1997 1996 1997 1996 1997
- ------------------------------------- ---------------- ---------------- --------------- ---------------- ----------------

OPERATING REVENUES:

Service....................... $ 8,583 $ - $ 9,366 $ - $ 9,399
Equipment..................... 16,803 - 25,487 - 29,629
---------------- ---------------- --------------- ---------------- ----------------
Total operating revenues.... 25,386 - 34,853 - 39,028

OPERATING EXPENSES:
Cost of service............... 34,883 3,094 57,288 3,099 79,216
Cost of equipment............. 52,424 - 78,833 - 92,981
Selling....................... 29,847 896 42,486 959 80,976
General and administrative.... 119,644 42,523 224,090 73,179 565,900
Depreciation and amortization. 66,300 384 100,682 638 112,206
---------------- ---------------- --------------- ---------------------------------
Total operating expenses.... 303,098 46,897 503,379 77,875 931,279

LOSS FROM OPERATIONS............. (277,712) (46,897) (468,526) (77,875) (892,251)

OTHER INCOME (EXPENSE):
Interest income............... 372 955 1,274 940 9,895
Interest expense.............. (12,077) - (12,171) (342) (12,720)
Other income.................. 1,753 71 2,875 214 4,717
Equity in loss of unconsolidated
partnership................. - (44,899) - (81,132) (138,490)
---------------- ---------------- --------------- ---------------- ----------------
Total other income (expense) (9,952) (43,873) (8,022) (80,320) (136,598)

================ ================ =============== ================ ================
NET LOSS......................... $ (287,664) $ (90,770) $ (476,548) $ (158,195) $ (1,028,849)
================ ================ =============== ================ ================

See notes to consolidated condensed financial statements.

PART I.
Item 1a.
SPRINT SPECTRUM L.P.
(A Development Stage Enterprise)
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In Thousands)

Cumulative
Period from
October 24,
Six Months Ended 1994 (date of
inception) to
June 30, June 30,
--------------------------------------
1997 1996 1997
- --------------------------------------------------------------------------------------------------

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss........................................ $ (476,548) $ (158,195) $ (1,028,849)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Equity in loss of unconsolidated partnership.. - 81,132 138,490
Depreciation and amortization of property and 100,682 638 112,206
intangibles.................................
Amortization of debt discount and issuance 22,615 - 36,623
costs.......................................
Loss on disposal of non-network equipment..... - - 31
Changes in assets and liabilities:
Receivables................................. (29,541) (3,901) (46,872)
Inventory................................... (11,824 - (84,238)
Prepaid expenses and other assets........... (8,664) (358) (30,460)
Accounts payable and accrued expenses....... (3,552) 22,449 257,420
Long term compensation obligation........... 8,917 4,750 20,273
--------------- -------------- ---------------
Net cash used in operating activities....... (397,915) (53,485) (625,376)

CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures......................... (750,740) (197,613) (1,466,803)
Microwave relocation costs................... (80,035) (27,146) (203,389)
Purchase of PCS licenses..................... - - (2,124,594)
Investment in unconsolidated partnership..... - - (131,752)
Loan to unconsolidated partnership........... - (138,000) (172,655)
--------------- -------------- ---------------
Net cash used in investing activities........ (830,775) (362,759) (4,099,193)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term debt and vendor
financing.................................. 1,156,128 472 1,830,329
Payments on long-term debt................... (40,023) - (40,047)
Debt issuance costs.......................... (20,000) (1,305) (91,791)
Limited partner interest in consolidated
subsidiary................................ - - 5,000
Borrowings from affiliates................... - - 5,000
Partner capital contributions................ 175,000 447,509 3,141,315
Dividends paid............................... - - (32,834)
--------------- -------------- ---------------
Net cash provided by financing activities.... 1,271,105 446,676 4,816,972

--------------- -------------- ---------------
INCREASE IN CASH AND CASH EQUIVALENTS.......... 42,415 30,432 92,403

CASH AND CASH EQUIVALENTS, Beginning of period.. 49,988 1,123 -

--------------- -------------- ---------------
CASH AND CASH EQUIVALENTS, End of period.. $ 92,403 $ 31,555 $ 92,403
=============== ============== ===============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid, net of amount capitalized....... $ 27 $ - $ 350

NON-CASH INVESTING ACTIVITIES:
A PCS license covering the Omaha MTA and valued
at $6,229 was contributed to the Company by Cox
Communications during the six months ended June
30, 1997.

Capital expenditures of $750,740 and $1,466,803
for the six months and cumulative period ended
June 30, 1997, respectively are net of
construction obligations of $452,206 and
$1,167,140, respectively.

See notes to consolidated condensed financial statements.

PART I.
Item 1a.

SPRINT SPECTRUM L.P.
(A Development Stage Enterprise)
Notes to Consolidated Condensed Financial Statements (Unaudited)
June 30, 1997 and 1996

The information contained in this Form 10-Q for the three- and six-month
interim periods ended June 30, 1997 and 1996 and the cumulative period from
October 24, 1994 (date of inception) to June 30, 1997 has been prepared in
accordance with instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In
the opinion of management, all adjustments considered necessary, consisting only
of normal recurring accruals, to present fairly the consolidated financial
position, results of operations, and cash flows for such interim periods have
been made (See Note 1).

Certain information and footnote disclosures normally included in
consolidated financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. The results of operations
for the six months ended June 30, 1997 are not necessarily indicative of the
operating results that may be expected for the year ended December 31, 1997.

1. Organization

Sprint Spectrum L.P. (the "Company") is a limited partnership formed in
Delaware on March 28, 1995, by Sprint Spectrum Holding Company, L.P.
("Holdings") and MinorCo, L.P. ("MinorCo") both of which were formed by Sprint
Enterprises, L.P., TCI Spectrum Holdings, Inc. (formerly known as TCI Telephony
Services, Inc., as successor to TCI Network Services), Cox Telephony Partnership
and Comcast Telephony Services (together the "Partners"). The Company was formed
pursuant to a reorganization of the operations of an existing partnership,
WirelessCo, L.P. ("WirelessCo") which transferred certain operating functions to
Holdings. The Partners are subsidiaries of Sprint Corporation ("Sprint"),
Tele-Communications, Inc. ("TCI"), Cox Communications, Inc. ("Cox"), and Comcast
Corporation ("Comcast" and together with Sprint, TCI and Cox, the "Parents"),
respectively. The Partnership and certain other affiliated partnerships offer
services as Sprint PCS.

The partners of the Company have the following ownership interests as of
June 30, 1997 and 1996:

Sprint Spectrum Holding Company, L.P. (general partner)....greater than 99%
MinorCo, L.P. (limited partner)................................less than 1%

The Company is consolidated with its subsidiaries, WirelessCo, Sprint
Spectrum Equipment Company, L.P. ("EquipmentCo"), Sprint Spectrum Realty
Company, L.P. ("RealtyCo") and Sprint Spectrum Finance Corporation ("FinCo").
WirelessCo was formed on October 24, 1994 to invest in and hold the PCS
licenses. On May 15, 1996, EquipmentCo and RealtyCo were organized for the
purpose of holding PCS network-related real estate interests and assets. On May
20, 1996, FinCo was formed to be a co-obligor of the senior notes and senior
discount notes.

Development Stage Company - The Company and its subsidiaries are
development stage enterprises. The success of the Company's development is
dependent on a number of business factors, including maintaining financing to
complete network construction, generating operating revenues, successfully

deploying the PCS network and attaining profitable levels of market demand
for Company products and services.

2. Summary of Significant Accounting Policies

Basis of Presentation - Prior to July 1, 1996, substantially all wireless
operations of Sprint Spectrum L.P. and subsidiaries and Holdings were conducted
at Holdings and substantially all operating assets and liabilities, with the
exception of the interest in an unconsolidated subsidiary and the ownership
interest in PCS licenses, were held at Holdings. As of July 1, 1996, Holdings
transferred these net assets, and assigned agreements related to the wireless
operations to which it was a party to Sprint Spectrum L.P. (the
"Reorganization").

For purposes of these consolidated condensed financial statements, these
transactions have been treated as transactions between entities under common
control and accounted for in a manner similar to a pooling of interest ("As
Reorganized"). The Company, as used in these financial statements, includes the
pooled operations of Holdings through June 30, 1996. Accordingly, for periods
prior to July 1, 1996, Sprint Spectrum L.P.'s historical financial statements
have been restated to reflect those operations of Holdings that were transferred
on July 1, 1996 on a pooled basis. Information as of June 30, 1996 with respect
to the financial position and results of operations pooled herein is as follows
(in thousands):

Sprint
Spectrum L.P. Holdings Combined

Total Assets.................................. $2,268,805 $ 2,561,328 $2,561,328

Partners' Capital & Accumulated Deficit....... 2,258,426 2,469,529 2,472,384

Net Loss...................................... (81,278) (158,195) (158,195)

Revenue Recognition - Operating revenues for PCS services are recognized as
service is rendered. Operating revenues for equipment sales are recognized at
the time the equipment is delivered to a customer or an unaffiliated agent.

Accounts Receivable - Accounts receivable are net of an allowance for doubtful
accounts of approximately $1.7 million and $202,000 at June 30, 1997 and
December 31, 1996, respectively.

Investment in PCS Licenses and Other Intangibles - During 1994 and 1995, the
Federal Communications Commission ("FCC") auctioned PCS licenses in specific
geographic service areas. The FCC grants licenses for terms of up to ten years,
and generally grants renewals if the licensee has complied with its license
obligations. The Company believes it has and will continue to meet all
requirements necessary to secure renewal of its PCS licenses. The Company has
also incurred costs associated with microwave relocation in the construction of
the PCS network. Amortization of PCS licenses and microwave relocation costs
will commence as each service area becomes operational, over estimated useful
lives of 40 years. Accumulated amortization for PCS licenses and microwave
relocation costs totaled approximately $20.7 million and $1.7 million as of June
30, 1997 and December 31, 1996, respectively. Interest expense capitalized
pertaining to the acquisition of the PCS licenses has been included in Property,
plant and equipment.

Capitalized Interest - Interest costs associated with the construction of
capital assets incurred during the period of construction are capitalized. The
total capitalized as of June 30, 1997 and December 31, 1996 was approximately
$100.8 million and $30.5 million, respectively.

Major Customer - The Company markets its products through multiple distribution
channels, including Company-owned retail stores and third-party retail outlets.
Sales to one third-party retail customer exceeded 10% of Equipment revenue in
the consolidated condensed statements of operations for the three and six months
ended June 30, 1997.

Income Taxes - The Company has not provided for federal or state income taxes
since such taxes are the responsibility of the individual Partners.

Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

Paging Services - The Company has commenced paging services pursuant to
agreements with Paging Network Equipment Company ("PageNet") and Sprint
Communications Company, L.P. ("Sprint Communications"). For the six months ended
June 30, 1997 and 1996, Sprint Communications received agency fees of
approximately $5.4 million and $620,000, respectively.

Reclassifications - Certain reclassifications have been made to the 1996
financial statements to conform with the 1997 financial statement presentation.

3. Long-Term Debt and Borrowing Arrangements

The long-term debt of the Company as of June 30, 1997 and December 31, 1996 is
summarized as follows (in thousands):

June 30, December 31,
1997 1996
---------------- ------------------

11% Senior Notes due in 2006 $ 250,000 $ 250,000
12 1/2% Senior Discount Notes due in 2006, net of unamortized
discount of $196,678 and $214,501 at June 30, 1997 and
December 31, 1996, respectively 303,322 285,499
Credit facility - term loans 300,000 150,000
Credit facility - revolving credit 350,000 -
Vendor financing 616,129 -
Note payable to affiliate due in 1998 5,000 5,000
Other 719 742
---------------- ------------------

Total debt 1,825,170 691,241
Less current maturities 5,038 5,049
---------------- ------------------

Long-term debt $ $ 686,192
1,820,132
================ ==================

Bank Credit Facility - The Company entered into an agreement with The Chase
Manhattan Bank ("Chase") as agent for a group of lenders for a $2 billion bank
credit facility dated October 2, 1996. The proceeds of this facility are to be
used to finance working capital needs, subscriber acquisition costs, capital
expenditures and other general Company purposes.

The facility consists of a revolving credit commitment of $1.7 billion and a
$300 million term loan commitment. As of June 30, 1997, the term loans bear a
weighted average interest rate of 8.12%. The amount available under the total
revolving credit commitment will be increased upon the achievement of certain
financial and operating conditions as defined in the agreement. As of June 30,
1997, $350 million had been drawn at a weighted average interest rate of 8.46%
and $100 million remained available. Commitment fees for the revolving portion
of the agreement are payable quarterly based on average unused revolving
commitments. The Company has had no additional borrowings under the revolving
credit facility subsequent to June 30, 1997.

Vendor Financing - As of October 2, 1996, the Company entered into financing
agreements with Northern Telecom, Inc. ("Nortel") and Lucent Technologies, Inc.
("Lucent" and together with Nortel, the "Vendors") for multiple drawdown term
loan facilities totaling $1.3 billion and $1.8 billion, respectively. The
proceeds of such facilities are to be used to finance the purchase of goods and
services provided by the Vendors.

On April 30, 1997, the Company amended the terms of its financing agreement with
Nortel. The amendment provides for a syndication of the financing commitment
between Nortel, several banks and other vendors (the "Nortel Lenders"). The
commitment provides financing in two phases. During the first phase, the Nortel
Lenders will finance up to $800 million. Under the second phase, the Nortel
Lenders will finance up to an additional $500 million upon the achievement of
certain operating and financial conditions. As of June 30, 1997, $145 million
had been borrowed at an interest rate of 9.16% with $655 million remaining
available under the first phase. In addition, the Company paid $20 million in
origination fees upon the initial draw down under the first phase and will be
obligated to pay additional origination fees on the date of the initial draw
down loan under the second phase. Subsequent to June 30, 1997, the Company
borrowed an additional $70.3 million under the Nortel facility.

On May 29, 1997, the Company amended the terms of its financing agreement with
Lucent. The amendment provides for a syndication of the financing commitment
between Lucent, Sprint and other banks and vendors (the "Lucent Lenders"). The
Lucent Lenders have committed to financing up to $1.5 billion through December
31, 1997, and up to an aggregate of $1.8 billion thereafter, with Sprint
financing up to $300 million. The Company pays a facility fee on the daily
amount of certain loans outstanding under the agreement, payable quarterly. The
Lucent agreement terminates June 30, 2001. As of June 30, 1997, the Company had
borrowed approximately $471 million under the Lucent facility at a weighted
average interest rate of 8.93%. Subsequent to June 30, 1997, the Company
borrowed an additional $35.8 million under the Lucent facility. There have been
no borrowings from Sprint under the Lucent facility.

The Nortel and Lucent agreements provide for conversion of accrued interest on
the outstanding debt into the long-term loan obligation through February 8, 1998
and March 30, 1998, respectively.

Certain amounts included under Construction Obligations on the consolidated
condensed balance sheets may be financed under the Vendor Financing agreements.

Part I.
Item 1b.

SPRINT SPECTRUM FINANCE CORPORATION
(A wholly-owned subsidiary of Sprint Spectrum L.P.)
CONDENSED BALANCE SHEETS

June 30, December 31,
1997 1996
- ----------------------------------------------------------------- ------------------ ------------------
(Unaudited)
ASSETS

Receivable from parent......................................... $ 100 $ 100
================== ==================
TOTAL ASSETS................................................... $ 100 $ 100
================== ==================

STOCKHOLDER'S EQUITY

Common stock, $1.00 par value; 1,000 shares authorized; 100
shares issued and outstanding................................ $ 100 $ 100

================== ==================
TOTAL STOCKHOLDER'S EQUITY..................................... $ 100 $ 100
================== ==================

See notes to condensed financial statements.

Part I.
Item 1b.

SPRINT SPECTRUM FINANCE CORPORATION
(A wholly-owned subsidiary of Sprint Spectrum L.P.)
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)

Period from
May 21, 1996
(date of inception)
Three Months Ended Six Months Ended to
June 30, 1997 June 30, 1997 June 30, 1997
--------------------- --------------------- ---------------------

Operating Revenues.................. $ - $ - $ -

Operating Expenses.................. - - -
--------------------- --------------------- ---------------------

Net Income.......................... $ - $ - $ -
===================== ===================== =====================

See notes to condensed financial statements.

Part I.
Item 1b.

SPRINT SPECTRUM FINANCE CORPORATION
(A wholly-owned subsidiary of Sprint Spectrum L.P.)
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

Six From
Months date of
Ended inception
June 30, to June 30, 1997
1997
------------------ -----------------

CASH FLOWS FROM OPERATING ACTIVITIES:

Adjustments to reconcile net income to net cash used in
operating activities:
Net income............................................... $ - $ -
Changes in assets and liabilities:
Receivables............................................ - (100)
------------------ ----------------

Net cash used in operating activities.................... - (100)

CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock................................. - 100
------------------ ----------------

Net cash provided by financing activities................ - 100

------------------ ----------------

INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS......................................... - -

CASH AND CASH EQUIVALENTS, Beginning of Period..............
- -

================== =================
CASH AND CASH EQUIVALENTS, End of Period.................... $ - $ -
================== =================

See notes to condensed financial statements.

Part I.
Item 1b.

SPRINT SPECTRUM FINANCE CORPORATION
(A wholly-owned subsidiary of Sprint Spectrum L.P.)
NOTES TO CONDENSED FINANCIAL STATEMENTS

The information contained in this Form 10-Q for the three- and six-month interim
periods ended June 30, 1997 and the cumulative period from May 21, 1996 (date of
inception) to June 30, 1997 has been prepared in accordance with instructions to
Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all
adjustments considered necessary, consisting only of normal recurring accruals,
to present fairly the consolidated financial position, results of operations,
and cash flows for such interim periods have been made.

Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. The results of operations for the six months
ended June 30, 1997 are not necessarily indicative of the operating results that
may be expected for the year ended December 31, 1997.

1. ORGANIZATION

Sprint Spectrum Finance Corporation ("FinCo"), a Delaware corporation, was
formed on May 21, 1996 and is a wholly-owned subsidiary of Sprint Spectrum L.P.
(the "Partnership"). FinCo was formed to be a co-obligor of $250 million in
Senior Notes and $500 million in Senior Discount Notes.

The Partnership contributed $100 to FinCo on May 21, 1996 in exchange for 100
shares of common stock.

PART I.
Item 2a.
SPRINT SPECTRUM L.P.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with Sprint
Spectrum L.P.'s consolidated condensed financial statements and notes thereto.
The term "Company" refers to Sprint Spectrum L.P. and its direct and indirect
subsidiaries, including FinCo, WirelessCo, RealtyCo, and EquipmentCo. As of July
1, 1996, Holdings transferred substantially all operating assets and liabilities
to the Company. The Company's financial information as presented includes the
pooled operations of Holdings through June 30, 1996.

The Company includes certain estimates, projections and other forward-looking
statements in its reports as well as in presentations to analysts and others and
in other material disseminated to the public. There can be no assurances of
future performance and actual results may differ materially from those in the
forward-looking statements. Factors which could cause actual results to differ
materially from estimates or projections contained in forward-looking statements
include:

- the establishment of a market for new digital PCS services;
- the introduction of competitive service plans and pricing and other
effects of vigorous competition in the markets in which the Company
currently operates or intends to market its services;
- the impact of technological change which may diminish the value of
existing equipment which may, in turn, result in the need to incur
additional costs to upgrade previously sold communications equipment;
- the cost of entering new markets necessary to provide services;
- the impact of any unusual items resulting from ongoing evaluations of
the Company's business strategies;
- the effects of unanticipated delays or problems with the development
of technologies and systems used by the Company;
- requirements imposed on the Company and its competitors by the
Federal Communications Commission ("FCC") and state regulatory
commissions under the Telecommunications Act of 1996;
- the possibility of one or more of the markets in which the Company
will compete being impacted by variations in political, economic or
other factors over which the Company has no control;
- the effects of unanticipated delays resulting from zoning or other
disputes with municipalities; and
- unexpected results in litigation.

General

The Company is a development stage enterprise formed for the purpose of
establishing a nationwide personal communications service ("PCS") wireless
telecommunications network. The Company acquired PCS licenses in the FCC's A
Block and B Block PCS auction, which concluded in March 1995, to provide service
to 29 major trading areas ("MTAs") covering 150.3 million Pops. Additionally,
Cox contributed to the Company, effective February 6, 1997, a PCS license for
the Omaha MTA covering 1.7 million Pops. The Company has also affiliated and
expects to continue to affiliate with other PCS

providers. Pursuant to affiliation agreements, each affiliated PCS service
provider will use the Sprint (a registered trademark of Sprint Communications
Company, L.P.) brand name. Holdings owns a 49% limited partnership interest in
American PCS, L.P. ("APC"), which, through subsidiaries, owns a PCS license for,
and operates a broadband GSM (global system for mobile communications) PCS
system in, the Washington D.C./Baltimore MTA. APC has affiliated with the
Company and is marketing its products and services under the Sprint brand name.
Holdings also owns a 49% limited partnership interest in Cox Communications PCS,
L.P. ("Cox PCS"), a limited partnership that owns a PCS license for the Los
Angeles-San Diego MTA covering 21.5 million Pops. Cox, which previously owned
this license, contributed the license to Cox PCS on March 31, 1997 and will
manage and control Cox PCS. The Company signed an affiliation agreement with Cox
PCS on December 31, 1996.

The Company also expects to provide various services to PhillieCo, L.P.
("PhillieCo"), a limited partnership organized by and among subsidiaries of
Sprint, TCI and Cox that owns a PCS license for the Philadelphia MTA covering
9.1 million Pops. In addition, SprintCom, Inc. ("SprintCom"), an affiliate of
Sprint, participated in the FCC's D and E Block auction which ended January 14,
1997, and was awarded licenses for 139 of 493 Basic Trading Areas ("BTAs")
covering 70 million Pops, all of which are geographic areas not covered by the
Company's owned PCS licenses or licenses owned by PhillieCo, APC or Cox PCS. The
Company is in the process of negotiating an agreement with SprintCom to build
out the network infrastructure in certain BTA markets where SprintCom was
awarded PCS licenses. In accordance with an agreement among the Partners and the
Amended and Restated Agreement of Limited Partnership of MajorCo, L.P. (renamed
Sprint Spectrum Holding Company, L.P.) dated January 31, 1996 (the "Partnership
Agreement"), SprintCom is required to offer to enter into an affiliation
agreement with Holdings with respect to such BTA licenses pursuant to which
SprintCom's systems in such areas would be included in the Company's national
PCS network, although no assurance can be given that SprintCom and Holdings will
enter into any such affiliation agreement.

To date, the Company has incurred expenditures in conjunction with PCS license
acquisitions, initial design and construction of the PCS network, engineering,
marketing, administrative and other start up related expenses. The Company
commenced initial commercial operations in certain MTAs for its PCS services
late in the fourth quarter of 1996 and, as a result, has generated minimal
operating revenues. The Company intends to initiate service in portions of most
MTAs during the summer of 1997. Pop coverage at the end 1997 is expected to
reach approximately 55% of the Pops in all of the Company's license areas with
coverage in the individual license areas ranging from 19% to 80%. The timing of
launch in individual markets will be determined by various factors, principally
zoning and local competitive market factors. The Company intends to continue to
expand its coverage in its PCS markets in its existing license areas based on
actual market experience, customer demand, and reductions in the cost of
technology. The extent to which the Company is able to generate operating
revenue and earnings is dependent on a number of business factors, including
maintaining existing financing to complete network construction, generating
operating revenues, successfully deploying the PCS network and attaining
profitable levels of market demand for the Company's products and services.

Liquidity and Capital Resources

The buildout of the Company's PCS network and the marketing and distribution of
the Company's PCS products and services will continue to require substantial
capital. The Company currently estimates that its capital requirements (capital
expenditures, the cost of its existing licenses, working capital, debt service
requirements and anticipated operating losses) for the period from inception
through the end of 1998 (based on the Company's current plans for its network
buildout in its current license areas) will total approximately $8.9 billion (of
which approximately $6.2 billion had been expended as of June 30,

1997). After 1998, the Company will also require additional capital for coverage
expansion, volume-driven network capacity and other capital expenditures for
existing and new license areas (if any), working capital, debt service
requirements and anticipated further operating losses. Costs associated with the
network buildout include switches, base stations, towers, antennae, radio
frequency engineering, cell site construction and microwave relocation.
Management estimates that capital expenditures associated with the buildout will
total approximately $3.9 billion through 1997, including $3.2 billion through
June 30, 1997. Actual amounts of the funds required may vary materially from
these estimates and additional funds would be required in the event of
significant departures from the current business plan, unforeseen delays, cost
overruns, unanticipated expenses, regulatory changes, engineering design changes
and other technological risks.

The Company currently has minimal sources of revenue to meet its capital
requirements and has relied upon capital contributions, advances from Holdings,
third party debt and public debt. The Holdings partnership agreement provides
for a planned capital amount to be contributed by the Partners ("Total Mandatory
Contributions"), which represents the sum of $4.2 billion, which includes agreed
upon values attributable to the contributions of certain additional PCS licenses
by a Partner. The Total Mandatory Contributions amount is required to be
contributed in accordance with capital contribution schedule to be set forth in
approved annual budgets if requested by the Holdings partnership board (or by
the Chief Executive Officer of Holdings pursuant to authority to be granted in
each annual budget or such other authority as may be delegated to the Chief
Executive Officer by the Holdings partnership board). The partnership board of
Holdings may request capital contributions to be made in the absence of an
approved budget or more quickly than provided for in an approved budget, but
always subject to the Total Mandatory Contributions limit. The proposed budget
for 1997 has not yet been approved by the partnership board, however, the
Company is continuing to act under the authority of the 1996 approved budget as
adjusted pursuant to the Holdings partnership agreement. The Amended and
Restated Capital Contribution Agreement (the "Amended Agreement") was executed
effective October 2, 1996. The Amended Agreement recognized that through
December 31, 1995, approximately $2.2 billion of the Total Mandatory
Contributions had been contributed to Sprint Spectrum L.P., and designates that
approximately $1.0 billion of the balance of the Total Mandatory Contributions
shall be contributed to Sprint Spectrum L.P. As of June 30, 1997, $2.7 billion
had been contributed to Sprint Spectrum. The Company's business plan and the
financial covenants and other terms of the Secured Financing (defined below)
will require such additional equity financing prior to the end of 1998, absent a
new financing source. The $1.0 billion portion of the $4.2 billion not required
to be invested in the Company may be used by Holdings to fund its other
affiliate commitments and make other wireless investments. Amounts budgeted by
the Partners in future years will determine the extent to which the commitments
will actually be utilized.

In October 1996, the Company entered into a credit agreement with The Chase
Manhattan Bank, as administrative agent for a group of lenders, for a $2.0
billion senior secured credit facility (the "Bank Facility"). The proceeds of
the Bank Facility are to be used to finance working capital needs, subscriber
acquisition costs, capital expenditures and other general purposes of the
Company. The Bank Facility consists of a $300 million term loan commitment and a
revolving credit commitment of $1.7 billion. Of the $300 million term facility,
$150 million was drawn down subsequent to closing, and the remaining $150
million was drawn down in January, 1997. As of June 30, 1997, $350 million had
been borrowed and $100 million remained available under the revolving credit
facility. Availability under the Bank Facility will increase subject to the
Company meeting certain performance criteria.

Also in October 1996, the Company entered into credit agreements for up to an
aggregate of $3.1 billion of senior secured multiple drawdown term loan
facilities from two of its network infrastructure

equipment vendors. As amended in April 1997, the Nortel facility will provide up
to $1.3 billion in senior secured loans. The Lucent facility, as amended in May
1997, will provide up to $1.8 billion in senior secured loans (together the
"Vendor Financing" and together with the Bank Facility, the "Secured
Financing"). The Company will use the proceeds from the Vendor Financing to fund
the purchase of the equipment and software manufactured by the vendors as well
as substantially all of the construction and ancillary equipment (e.g., towers,
antennae, cable) required to construct the Company's PCS network. These
facilities will serve as the primary financing mechanism for the buildout of the
network.

Borrowings under the Secured Financing are secured by the Company's interest in
WirelessCo, RealtyCo and EquipmentCo and certain other personal and real
property (the "Shared Lien"). The Shared Lien equally and ratably secures the
Bank Facility and the Vendor Financing. The Secured Financing is jointly and
severally guaranteed by WirelessCo, RealtyCo and EquipmentCo and is non-recourse
to the Partners and the Parents.

In August 1996, Sprint Spectrum L.P. and FinCo issued $250 million aggregate
principal amount of the 11% Senior Notes and $500 million aggregate principal
amount at maturity of 12 1/2% Senior Discount Notes (together, the "Notes"). The
Senior Discount Notes were issued at a discount to their aggregate principal
amount at maturity and generated proceeds of approximately $273 million. Cash
interest on the Senior Notes will accrue at a rate of 11% per annum and is
payable semi-annually in arrears on each February 15 and August 15, commencing
February 15, 1997. Cash interest will not accrue or be payable on the Senior
Discount Notes prior to August 15, 2001. Thereafter, cash interest on the Senior
Discount Notes will accrue at a rate of 12 1/2% per annum and will be payable
semi-annually in arrears on each February 15 and August 15, commencing February
15, 2002. FinCo was formed solely to be a co-obligor of the Notes. FinCo has
only nominal assets and no operations or revenues, and Sprint Spectrum L.P. will
be responsible for payment of the Notes. On August 15, 2001, Sprint Spectrum
L.P. will be required to redeem an amount equal to $384.772 per $1,000 principal
amount at maturity of each Senior Discount Note then outstanding ($192 million
in aggregate principal amount at maturity, assuming all of the Senior Discount
Notes remain outstanding at such date). The proceeds of approximately $509
million from the issuance of the Notes (net of approximately $14 million of
underwriting discounts, commissions, and offering expenses) were used to fund
capital expenditures, including the buildout of the nationwide PCS network, to
fund working capital requirements, to fund operating losses and for other
partnership purposes. Sprint purchased, and continues to hold, approximately
$183 million principal amount at maturity of the Senior Discount Notes.

Sources of funding for the Company's further financing requirements may include
additional vendor financing, public offerings or private placements of equity
and/or debt securities, commercial bank loans and/or capital contributions from
Holdings or the Partners. There can be no assurance that any additional
financing can be obtained on a timely basis and on terms acceptable to the
Company and within limitations contained in the Notes, the agreements governing
the Secured Financing and any new financing arrangements. Failure to obtain any
such financing could result in the delay or abandonment of the Company's
development and expansion plans and expenditures or the failure to meet
regulatory requirements. It also could impair the Company's ability to meet its
debt service requirements and could have a material adverse effect on its
business.

For the year-to-date period ended June 30, 1997, the Company used cash of $394
million in operating activities, which consisted of the operating loss of $477
million less depreciation and amortization of $123 million, an increase in
receivables, inventory and other assets of $52 million, offset by increases in
payables, accrued expenses and long-term accruals of $11 million. Cash used in
investing activities totaled $834 million, consisting of capital expenditures
and microwave relocation costs.

Results of Operations

For the Three and Six Months Ended June 30, 1997

Operating Revenues/Margin

The Company commenced initial commercial operations for its PCS services in
certain MTAs late in the fourth quarter of 1996 and, as a result, has generated
minimal operating revenues. The negative margin from equipment sales results
from the Company's subsidy of handsets. Cost of service consists principally of
switch and cell site expenses, including site rental, utilities and access
charges. Prior to service launch, such costs were incurred during the network
buildout and testing phases. As markets launch, costs are incurred to provide
service in the related markets.

Selling Expenses

The Company's selling expenses for the second quarter of 1997 were $29.8 million
compared to $0.9 million for the second quarter of 1996. For the six months
ended June 30, 1997, selling expenses increased to $42.5 million from $0.9
million for the same six months of 1996. These increases were due to costs
incurred in preparation of and during the initial commercial service launch in
various markets. Such costs include participation with Sprint in an NFL
sponsorship, development and production expenses associated with advertisements
in various media (i.e., television, radio, print), and the development of
printed brochures to promote the Company's products and services. The Company
expects selling expenses will continue to increase as the Company expands its
sales and marketing activities.

General and Administrative

General and administrative expenses for the second quarter increased from $42.5
million in 1996 to $119.6 million in 1997. General and administrative expenses
for the six months ended June 30, 1996 and 1997 were $73.2 million and $224.1
million, respectively. Increases for both the three and six month periods were
due principally to increases in salary and related benefits, computer equipment
and related expenses and professional and consulting fees. Salaries and
benefits, computer equipment and related expenses increased due to an increase
in employee headcount. Professional and consulting fees increased due to the use
of consultants and other experts to assist with the continuing development and
enhancement of the Company's sophisticated information systems, continued
rollout and tailoring of training programs for the Company's sales force, and
various other projects.

Depreciation and Amortization

Depreciation and amortization expense for the second quarter of 1997 was $66.3
million compared to $0.4 million for the same period in the prior year.
Depreciation and amortization expense of $100.7 million for the six months ended
June 30, 1997, was an increase from $0.6 million for the same period in 1996 as
certain network equipment has been placed in service and amortization of PCS
licenses and microwave relocation costs in the launched markets commenced.

Other Income/Expense

Interest Income/Expense

Interest income decreased from $1.0 million for the three months ended June 30,
1996 to $0.4 million for the three months ended June 30, 1997 as the average
daily invested cash balance decreased during the comparative periods due to the
receipt in the prior year of partner equity contributions in advance of capital
and operational requirements. Interest income increased from $0.9 million for
the six months ended June 30, 1996 to $1.3 million for the six months ended June
30, 1997 as the Company borrowed funds during the first quarter of the current
year in accordance with the terms of the loan agreements resulting in excess
cash balances.

Interest expense increased to $12 million for the three and six months ended
June 30, 1997, as the Company's construction activities declined during the
period as markets launched commercial service, resulting in the capitalization
of less than 100% of the interest expense incurred during the period.
Additionally, interest expense continues to increase as borrowings increase.

Other Income

Equity in loss of unconsolidated partnership for the three and six months ended
June 30, 1996 represents the Company's share of the losses in APC before the
ownership interest was transferred to Holdings on August 31, 1996. The Company
retained the rights and obligations under the affiliation agreement with APC. In
addition, the Company participates in an affiliation agreement with Cox PCS.
Fees earned under these agreements of $1.8 million and $2.9 million for the
three and six months ended June 30, 1997 are shown in Other income.

For the Three and Six Months Ended June 30, 1996

The Company incurred losses of $91 million and $158 million for the three and
six months ended June 30, 1996, respectively. These losses include equity in
loss of an unconsolidated subsidiary of $45 million and $81 million for the
three and six month periods, respectively. There was no amortization of PCS
licenses during the six-month period as PCS service had not been launched
commercially.

PART I.
Item 2b.
SPRINT SPECTRUM FINANCE CORPORATION
(A Wholly-Owned Subsidiary of Sprint Spectrum L.P.)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

Sprint Spectrum Finance Corporation ("FinCo"), a Delaware corporation, was
formed on May 21, 1996 and is a wholly-owned subsidiary of Sprint Spectrum L.P.
FinCo has nominal assets, does not conduct any operations and was formed to be a
co-obligor of the securities issued by the Company. Certain institutional
investors who might otherwise be limited in their ability to invest in
securities issued by partnerships by reasons of the legal investment laws in
their states of organization or their charter documents, may be able to invest
in the Company's securities because FinCo is a co-obligor. Accordingly, a
discussion of the results of operations, liquidity and capital resources of
FinCo are not presented.

PART II.
Other Information

Item 1. Legal Proceedings