OVERVIEW

Sprint Corporation, including its consolidated subsidiaries, 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. Unless the context
otherwise requires, references to "Sprint," "we," "us," "our" and the "Company"
mean Sprint Corporation and its consolidated subsidiaries for all periods
presented, and references to "Sprint Communications" are to Sprint
Communications, Inc. and its consolidated subsidiaries.
Description of the Company
We are a large wireless communications company in the U.S., as well as a
provider of wireline services. Our services are provided through our ownership
of extensive wireless networks, an all-digital global wireline network and a
Tier 1 Internet backbone.
We offer wireless and wireline services to subscribers in all 50 states, Puerto
Rico, and the U.S. Virgin Islands under the Sprint corporate brand, which
includes our retail brands of Sprint®, Boost Mobile®, Virgin Mobile®, and
Assurance Wireless® on our wireless networks utilizing various technologies
including third generation (3G) code division multiple access (CDMA) and fourth
generation (4G) services utilizing Long Term Evolution (LTE). In 2019, Sprint
launched fifth generation (5G) service in nine major cities, which is supported
by our available 2.5 GHz spectrum. We utilize these networks to offer our
wireless subscribers differentiated products and services through the use of a
single network or a combination of these networks.
Business Combination Agreement
On April 29, 2018, we announced that we entered into a Business Combination
Agreement with T-Mobile US, Inc. (T-Mobile) to merge in an all-stock transaction
for a fixed exchange ratio of 0.10256 of T-Mobile shares for each Sprint share,
or the equivalent of 9.75 Sprint shares for each T-Mobile share (Merger
Transaction). Immediately following the Merger Transaction, Deutsche Telekom AG
and SoftBank Group Corp. are expected to hold approximately 42% and 27% of
fully-diluted shares of the combined company, respectively, with the remaining
31% of the fully-diluted shares of the combined company held by public
stockholders. The board of directors will consist of 14 directors, of which nine
will be nominated by Deutsche Telekom AG, four will be nominated by SoftBank
Group Corp., and the final director will be the CEO of the combined company. The
combined company will be named T-Mobile. The Merger Transaction is subject to
customary closing conditions, including certain state and federal regulatory
approvals. Sprint and T-Mobile completed the Hart-Scott-Rodino filing with the
Department of Justice (DOJ) on May 24, 2018. On June 18, 2018, the parties filed
with the Federal Communications Commission (FCC) the merger applications,
including the Public Interest Statement. On July 18, 2018, the FCC accepted the
applications for filing and established a public comment period for the Merger
Transaction. The formal comment period concluded on October 31, 2018. On May 20,
2019, to facilitate the FCC's review and approval of the FCC license transfers
associated with the proposed Merger Transaction, we and T-Mobile filed with the
FCC a written ex parte presentation (the Presentation) relating to the proposed
Merger Transaction. The Presentation included proposed commitments from us and
T-Mobile. On October 16, 2019, the FCC voted to approve the Merger Transaction.
The Merger Transaction received clearance from the Committee on Foreign
Investment in the United States on December 17, 2018.
On July 26, 2019, the DOJ and five State Attorneys General filed an action in
the United States District Court for the District of Columbia that would resolve
their objections to the Merger Transaction. Since then, five additional states
have joined the DOJ action. The Merger Transaction has received approval from 18
of the 19 state public utility commissions. The parties are awaiting further
regulatory approvals and resolution of litigation filed by the Attorneys General
of 13 states and the District of Columbia seeking to block the Merger
Transaction. The parties to the Business Combination Agreement extended the
Outside Date (as defined in the Business Combination Agreement) to November 1,
2019, or, if the Marketing Period (as defined in the Business Combination
Agreement) is in effect at such time, then the Outside Date will be January 2,
2020. After November 1, 2019, Sprint and T-Mobile each have a right under the
Business Combination Agreement to terminate that agreement at any time because
the Merger Transaction was not completed as of that date.
Also, on July 26, 2019, Sprint and T-Mobile announced agreements with DISH
Network Corporation (DISH) in which new T-Mobile will divest Sprint's prepaid
businesses (excluding the Assurance brand Lifeline customers and the prepaid
wireless customers of Shenandoah Telecommunications Company and Swiftel
Communications, Inc.) and Sprint's 800 MHz spectrum assets to DISH for a total
of approximately $5.0 billion. Additionally, upon the closing of the divestiture
transaction, new T-Mobile will provide DISH wireless customers access to its
network for up to seven years and offer standard transition services
arrangements to DISH during a transition period of up to three years. DISH will
also have an

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option to take on leases for certain cell sites and retail locations that are
decommissioned by the new T-Mobile, subject to any assignment restrictions.
Under the terms of the arrangement, Sprint appointed individuals, subject to
approval by the DOJ, to oversee the prepaid assets and maintain complete
managerial responsibility, including the ability to make all business decisions
relating to the operations of the prepaid assets independent of Sprint and
T-Mobile. In connection with the execution of the firm agreements by and between
DISH and the Company, as well as the agreements with the DOJ as outlined in the
Proposed Final Judgment and Stipulation and Order, Sprint has not lost a
controlling financial interest in its prepaid assets. The transactions with DISH
are contingent on the successful closing of T-Mobile's merger with Sprint among
other closing conditions.
Leases
The Company adopted Leases (Topic 842) beginning on April 1, 2019 using the
modified retrospective transition method. See Note 7. Leases in Notes to the
Consolidated Financial Statements in Part I, Item 1. of this Quarterly Report on
Form 10-Q for additional information related to operating and financing leases,
including qualitative and quantitative disclosures required under Topic 842. The
impact to our consolidated financial statements of adopting Topic 842 is
presented in Note 2. New Accounting Pronouncements in Notes to the Consolidated
Financial Statements in Part I, Item 1. of this Quarterly Report on Form 10-Q.
Wireless
We offer wireless services on a postpaid and prepaid payment basis to retail
subscribers and also on a wholesale basis, which includes the sale of wireless
services that utilize the Sprint network but are sold under the wholesaler's
brand.
Postpaid
In our postpaid portfolio, we offer several price plans for both consumer and
business subscribers. Many of our price plans include unlimited talk, text and
data or allow subscribers to purchase monthly data allowances. We also offer
family plans that include multiple lines of service under one account.
Under the Sprint brand, we currently offer our devices through leasing and
installment billing programs, and within limited plan offerings devices may be
subsidized in exchange for a service contract. Our Sprint branded leasing and
installment billing programs do not require a long-term service contract but
offer devices tied to service plans at lower monthly rates when compared to
subsidy plans. The installment billing program requires the subscriber to pay
full or a discounted retail price based on promotional activities for the device
over the installment period. The leasing program requires the subscriber to pay
a rental fee over the lease term. In July 2017, we introduced the Sprint Flex
program, which gives customers the opportunity to enjoy their phone before
deciding what option (upgrade, continue leasing, return or buy) works best for
their lifestyle. Depending on device type, certain leases carry an option to
upgrade to a new device annually prior to expiration of the lease. The terms of
our lease and installment billing contracts require that customers maintain
service otherwise the balance of the remaining contractual obligation on the
device is due upon termination of their service. The subsidy program, which has
been de-emphasized, requires a long-term service contract and allows a
subscriber to purchase a device generally at a discount. In our non-Sprint
branded postpaid plan, we offer devices through an installment billing program
while requiring service to be purchased on a prepaid basis. The majority of
Sprint's current handset activations occur on our Sprint Flex leasing program.
Prepaid
Our prepaid portfolio currently includes multiple brands, each designed to
appeal to specific subscriber uses and demographics. Additionally, a subsidy
program is available within certain prepaid plan offerings. In our indirect
channel, customers who activate service under certain prepaid plan offerings are
able to purchase devices at a discount. Boost Mobile primarily serves
subscribers that are looking for value without data limits. Virgin Mobile
primarily serves subscribers that are looking to optimize spend but need
solutions that offer control, flexibility and connectivity through various plans
with high speed data options. In January 2020, we discontinued Virgin Mobile
service and have started transferring existing customers to the Boost Mobile
brand. Under the Assurance Wireless brand, we provide service to Lifeline
eligible subscribers (for whom it seeks reimbursement from the federal Universal
Service Fund) and subscribers who have lost their Lifeline eligibility and
retain Assurance Wireless retail service. The Lifeline program requires
applicants to meet certain eligibility requirements and existing subscribers
must recertify as to those requirements annually.
Wholesale
We have focused our wholesale business on allowing our diverse network of
customers to successfully grow their business by providing them with an array of
network, product, and device solutions. This allows our customers to customize
this full suite of value-added solutions to meet the growing demands of their
businesses. As part of these growing demands,

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some of our wholesale mobile virtual network operators (MVNO) are also selling
prepaid services under the Lifeline program.
We continue to support the open development of applications, content, and
devices on the Sprint network. In addition, we enable a variety of business and
consumer third-party relationships through our portfolio of machine-to-machine
solutions, which we offer on a retail postpaid and wholesale basis. Our
machine-to-machine solutions portfolio provides a secure, real-time and reliable
wireless two-way data connection across a broad range of connected devices.
Wireline
We provide a suite of wireline communication services to other communications
companies and targeted business customers. In addition, our Wireline segment
provides data and IP communication services to our Wireless segment. We provide
long distance services and operate all-digital global long distance and Tier 1
IP networks.
Business Strategies and Key Priorities
Our business strategy is to be responsive to changing customer mobility demands
of existing and potential customers, and to expand our business into new areas
of customer value and economic opportunity through innovation and
differentiation. To help lay the foundation for these future growth
opportunities, our strategy revolves around targeted investment in the following
key priority areas:
•           our Next-Gen network plan will deliver competitive coverage, faster
            speeds and more capacity;

• create a compelling unlimited value proposition;

• provide the best digital customer experience; and

• engage our employees by making Sprint a great place to work.




While the Company launched 5G in select cities in the first half of 2019 and we
plan to continue to invest in our network during the next few years, many of the
underlying service quality, scale, and financial challenges remain. We aim to
use our spectrum to build our 5G network on 2.5 GHz spectrum. See Network below
for more information regarding our network plans and potential challenges to our
rollout of 5G.
We aim to create a compelling unlimited value proposition by leveraging our
spectrum holdings while remaining the price leader on Unlimited plan offerings
and taking our brand to the next level.
We plan to continue to invest in digital capabilities and artificial
intelligence to improve the customer experience. We are focused on finding the
right balance between physical and digital retail to serve customers wherever
and whenever they want.
We have recruited leaders in our industry from around the globe and employ an
organizational focus to ensure Sprint has a work environment employees
recommend.
Network
We continue to increase coverage and capacity by densifying and evolving our
existing network toward 5G. Densification, which includes increasing the number
of small cells and antennas, is intended to enhance coverage and capacity across
the network. We are also deploying new technologies, such as Massive MIMO and
carrier aggregation, which allows us to move more data at faster speeds over the
same spectrum and eventually migrate customers to an all IP network, supporting
both Voice over LTE and data. Additionally, our tri-band devices, including
those with 5G capabilities, allows us to manage and operate our network more
efficiently and at a lower cost. We have continued to see positive results from
these infrastructure upgrades in key U.S. markets. While Sprint will build 5G in
a number of cities throughout the country, its current 5G build plans will
result in coverage that is limited to major cities and the surrounding areas
rather than coverage that blankets the entire geography of the United
States. Sprint's ability to expand its 5G network footprint outside of metro
areas will be limited by its financial resources, lack of scale and access to
low-band spectrum. Moreover, Sprint plans to focus on creating a 5G ecosystem
for smartphones and other mobile devices rather than stationary devices.
The 2.5 GHz spectrum band carries the highest percentage of Sprint's LTE data
traffic. We have significant additional capacity to grow the use of our 2.5 GHz
spectrum holdings into the future. Sprint believes it is well-positioned with
spectrum holdings of more than 160 MHz of 2.5 GHz spectrum in the top 100
markets in the U.S. Sprint's spectrum holdings allow us to introduce 5G in
parallel with 4G service over the same 2.5 GHz spectrum band, supporting the
early introduction of 5G devices without disrupting the capacity needed to
support our 4G users.
Overall, our densification and introduction of 5G technologies are expected to
continue to enhance the customer experience by adding data capacity, increasing
the wireless data speeds available to our customers, and improving network
performance for both voice and data services, especially in the geographic areas
where 5G will be provided. In the event the

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Merger Transaction is not completed, our ability to provide a nationwide network
capable of competing effectively with
other competitors in the wireless industry will depend on our access to, and
deployment of, adequate low-band spectrum, which we may not be able to obtain.
As part of the evolution of our existing network toward 5G, we plan to modify
our existing backhaul architecture to enable increased capacity to our network
at a lower cost by either negotiating lower vendor pricing for existing Ethernet
technology or replacing Ethernet with fiber. We expect to incur termination
costs associated with Ethernet contractual commitments with third-party vendors
ranging between approximately $25 million to $50 million, of which the majority
are expected to be incurred by December 31, 2020.
As previously announced, in 2019 Sprint launched 5G service in nine major
cities. Once 5G-compatible equipment is in place and activated, customers in
those cities will have access to Sprint's 5G network if they are in range of a
cell site that has been equipped with a 5G radio supported by available 2.5 GHz
spectrum and have a 5G-capable device. As more and more sites are 5G-enabled,
customers in those areas will be able to have an increasing percentage of their
mobile experiences on 5G rather than on LTE or 3G.
If the Merger Transaction with T-Mobile is not completed, it is expected that
Sprint will not be able to deploy a nationwide 5G network on the same scale and
on the same timeline as the combined company. For example, Sprint's standalone
5G network would be geographically limited to major cities and surrounding areas
due to both Sprint's limited current network footprint on which to build 5G
sites and the cost of utilizing 2.5 GHz spectrum for 5G. Significant changes to
the Company's network deployment and business plans could negatively impact the
Company's forecast of future operating results, which could result in asset
impairments in future periods.

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