Leap will not re-order the Apple iPhone despite bump up in sales

Last June, Leap Wireless took the (groan) leap and signed a pact with Apple to buy $900 million worth of Apple iPhone units over a three year period. But at first, Apple's iconic smartphone did not sell at all. In February, the mobile operator said that if sales of the iPhone didn't pick up, it would be on the hook for a $100 million payment to cover unsold Apple iPhone units by June. In a filing to the SEC, Leap at the time said that besides the $100 million in payments due this year, it could owe Apple $150 million and $200 million in 2014 and 2015 respectively.

Leap CEO Doug Hutcheson is now saying that a device financing program being offered by Leap is helping sell more units of the Apple iPhone. During Leap's last earnings call, Hutchinson said that the company is about to roll out another phase of the financing program that will expand it to cover two-thirds of those coming to Leap from post-paid carriers. Despite the recent bump up in iPhone sales, Hutcheson says the company will not purchase any more iPhone units beyond the amount it has contracted for from Apple.

Leap recently reported a loss of 93,037 customers in the first quarter. That was a big improvement on a sequential basis as the carrier lost 337,000 net subscribers in the fourth quarter. A year earlier, the carrier gained 258,060 customers in the first quarter. The mobile operator now has a total of 5.2 million customers. First quarter revenue dropped 4.3% to $789.9 million while service revenue declined 11.6%. Leap reported an operating loss of $29.4 million for the period.

The CEO also said that five more 4G LTE phones were coming to the carrier including the Samsung Galaxy S4.

source: FierceWireless