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Sprint Corp. (S)Corrected TranscriptQ4 2016 Earnings Call03-May-201730% more first-place metropolitan area RootScore Awards in the 76 markets measured so far in the first half of2017 compared to the year-ago testing period.Speaking of the customer experience, you may have seen in the media that J.D. Power, the leader inindependent industry benchmark studies, now ranks Sprint second out of all national carriers for wireless networkquality, ahead of AT&T and T-Mobile in all geographic regions of the U.S. in its latest wireless network qualityperformance study. This is very compelling because it is based on actual customers' feedback, based on theirexperience with our vastly improved network.Our densification program continues to build momentum as we now have thousands of permits in hand and we'reramping up construction in many markets.In addition, as you're well aware, Sprint has already deployed three-channel carrier aggregation in over 100markets. The best part of our carrier aggregation deployment is how seamless it is thanks to the fact that weutilize radios and antennas capable of multiple carriers when we originally deploy our 2.5 GHz, and as a result,generally, we do not need to go back to the tower each time that we light up another 20 MHz channel offerthrough those pipes.This increased depth of 2.5 GHz has allowed us to shift the majority of our LTE traffic onto the superhighway,which also provides a halo benefit to the customer experience by relieving capacity on the 801.9 LTE layer.Furthermore, Sprint was the first carrier to demonstrate gigabit-plus LTE in a public venue with a demonstration inEurolink in March.Now, I'll like to turn the call over to my chairman, Masa, to share with you how Sprint expects to make our networkeven greater in the future.Masayoshi SonChairman, Sprint Corp.Hey. Thank you, Marcelo. This is Masa. Marcelo is my boss. I have to report to Marcelo how I run the networkoperation, so I'm happy to tell you about the great progress we've made.So look at page 8, many people still may have the Sprint network is not as good as anybody else. Many peoplethink that we are number four. The reality is a little different. We are number two in voice performance nationwide.We used to be number four, but now we jumped up and became number two nationwide.But also on the left-hand side of this page you see, most metro, we actually became number one in voice award.This is the progress we've made, not just voice but we are going to be number one or number two also on thedata with LTE performance.So page 9 says that why we are going to be number one or number two in most markets in data also is becausewe have spectrum; we have innovation. These are the two reasons why we are going to make great progress.Page 10 as you can see, we have such a huge asset of 2.5 GHz spectrum, with High Power UE. So we expectgoing forward with our deployment of the new network, almost 90% of the total traffic capacity goes go throughour 2.5 GHz and with our High Power UE, we are becoming good enough as much as the 1.9 GHz coverage. And800 MHz will cover all the spillover of the coverage. That's where we have the strength, in 2.5 GHz.51-877-FACTSET www.callstreet.comCopyright 2001-2017 FactSet CallStreet, LLC

Sprint Corp. (S)Corrected TranscriptQ4 2016 Earnings Call03-May-2017So running High Power UE, page 11 says, used to be 2.5 GHz does not cover long enough distance, big enoughpenetration inside the building but by increasing the power in the handset unit with the new standard we create,agreed this year by all the major key players of the handsets, key players of the components, we haveestablished a new standard and that is the High Power UE. With this new standard in technology, our 2.5 gig nowgoes inside the building and the giga distance coverage as good as the mid-band. That's the great improvementof our capability.So we've got spectrum and new standard; now we have on top of that a new innovation of the tools. So page 12,five major new tools that we have invented. One is called mini macro; second, air pole; strand mount; Magic Box;and femto. These are the new tools that we invented and we created uniquely. Let me explain how it works.Page 13 on the left-hand side you see macro towers. Of course this is macro tower as good as our competitorswith 800 MHz, 1.9 GHz and 2.5 GHz. And on 2.5 GHz we have carrier aggregations and so on to increase thecapacity and the speed. But on top of that, in order to increase the better coverage in the in-building and increasealso the capacity of the network, we are putting all these tools throughout the towns.Page 14 we show the example of how our Magic Box will work. Unlike femtocell or typical small cell inside thebuilding, those small cell covers just the indoor. But our new invention is that this Magic Box covers not just theindoor from the inside the building, but also it will cover outdoor into the network, this is our invention. Andbecause we have 2.5 GHz spectrum we can make this happen and we have a new technology called UltraSON, agreat name. UltraSON, that is a sales organizing network. With this new technology, the populated, densenumber of Magic Box does not interfere each other and we cover indoor but also outdoor over the network. Howdoes it get placed? Page 15 you see the image of the Magic Boxes by the window.So, we put this box to cover indoor but also outdoor. This box can be connected through the fixed-line broadbandwith Wi-Fi, or if the household or building does not have those Wi-Fi connectivity, we get the backhaul from ourmacro towers, wireless. That's a great innovation and does not need any installation, it's fully automated.On page 16, we show the example. So let's say in the network we put one box inside one building on the left-handside and then it will shoot our signal to the adjacent buildings and all the neighborhood.Page 17 is another example. We cover all the neighborhood, the Magic Box not just for indoor, all theneighborhood. So you get connected in your garage, the garden and the street nearby and the household nearby.So, all of these tools and innovations with our 2.5 GHz spectrum we can differentiate ourselves and create thebest network, and we have start testing this deployment very recently into six clusters, New York, San Francisco,Chicago, Denver, Indianapolis and Houston.As you can see on this page 18, overall performance with the independent neutral party to check by P3, this is anindependent party to check the network quality and we get overall number one in New York, San Francisco,Chicago, Denver, Indianapolis. In Houston we are not number one yet, but this is – just we started with all these –six markets cluster. So, not just overall, but you see more detail with web browsing, download and YouTube appsand so on. We feel very proud about this result.So, you see more detail with page 19, this is the example of New York City in Manhattan Midtown and you cansee on the right-hand side with average download speed with Ookla and not just the speed but all the coverageand total performance by P3 checked, this is New York. And San Francisco test area is just on the left-hand side.61-877-FACTSET www.callstreet.comCopyright 2001-2017 FactSet CallStreet, LLC

Sprint Corp. (S)Corrected TranscriptQ4 2016 Earnings Call03-May-2017You can see the download speed and overall performance, again, we are number one. Chicago, number one alsoand so on.As a result I'm proud to say, and confidently I would say, as we have already achieved number one or numbertwo, the voice quality of the network, we will be number one or number two also on LTE data coverage and thespeed and the performance. So you will see, and my commitment, you will see the result happening over the next18 months, 20 months. By the end of next year, we will be number one or number two in most of the marketthroughout the United States.But importantly, as management, I will say we don't just waste the CapEx. We don't waste the money. We willmake this happen with the lowest CapEx compared to anybody else. As you have seen in the last 12 months, wespent the lowest CapEx among our competitors but we still achieved a great improvement in network with thevoice, number one, number two. And data network is coming along very quickly and we are confident and happyto say with all these early test markets, deployment is progressing fantastically. And I will give you the results.Thank you very much.Tarek A. RobbiatiChief Financial Officer, Sprint Corp.Thank you, Masa. Moving through revenue on slide 23, consolidated net operating revenues of 33.3 billion forthe year grew year-over-year for the first time in the last three years. This important milestone of returning to topline growth is the culmination of three consecutive quarters of year-over-year improvement including wirelessoperating revenue growing 7% in the fourth quarter.Wireless service revenue of nearly 24 billion also stabilized as we exited fiscal 2016 and had the lowest yearover-year decline in the last two years. Postpaid service revenue was essentially flat sequentially in the fourthquarter when normalizing for the change to record revenues associated with our device insurance program on anet basis beginning in the fourth quarter as we had foreshadowed for you last quarter.Similarly, prepaid service revenue was relatively flat sequentially as that business returned to volume growth inthe fourth quarter. As a reminder, Sprint changed the terms of its vendor agreement for our device insuranceprogram at the beginning of January which is expected to result in a net savings to the income statement.However, under the terms of the new agreement, Sprint expects to book the insurance program revenue on a netbasis and no associated costs compared to the prior program where we recorded the gross revenue from thecustomers as revenue and the associated expenses in cost of service. As a result, we expected our reportedservice revenue will be lower by approximately 200 million per quarter as reflected in the fourth quarter andrepresenting the new revenue baseline, while we would expect an even greater reduction in the associatedexpenses.Postpaid phone average billings per user was up slightly year-over-year in fiscal year 2016. For the fourth quarter,our postpaid phone average billings per user was relatively flat sequentially when normalizing for the change inrecognition for device insurance revenues, which had a roughly 2.50 impact in the quarter. 76% of postpaiddevice sales were financed for the full fiscal year with 42% being leased compared to 51% of sales being leasedin fiscal year 2015. We exited fiscal 2016 with 82% of postpaid sales being financed in the fourth quarter, whichincludes 86% of postpaid phone sales being financed. I will note that the remaining mix of device activationsprimarily represent bring-your-own-device transactions for customers electing to pay full price for their device, aswe have basically eliminated the traditional subsidy option for all consumer channels.71-877-FACTSET www.callstreet.comCopyright 2001-2017 FactSet CallStreet, LLC

Sprint Corp. (S)Corrected TranscriptQ4 2016 Earnings Call03-May-2017At the end of the quarter we had 74% of our postpaid phone base on unsubsidized plans with 65% currentlyhaving an active device financing commitment as of the end of the quarter. Prepaid ARPU of 28.01 in fiscal year2016 increased by 1% year-over-year.Regarding our expenses on side 24, we executed our second consecutive year of significant cost transformationin fiscal year 2016. We realized 2.1 billion in net reductions in operating expenses year-over-year in fiscal year2016 across cost of services and selling, general and administrative expenses.This brings our cumulative reductions across these two categories to almost 3.5 billion or an 18% reduction injust two years.As you may recall from our guidance earlier in the year we did incur over 230 million of one-time cost to achievethese run rate cost savings. As a result, our gross cost reduction in fiscal year 2016 was actually 2.3 billion.Cost of services for the year of 7.9 billion was down 1.6 billion year-over-year, driven by lower rent with theshutdown of the WiMAX network, lower labor expenses, lower roaming and backhaul expenses and lower wirelinecosts.Selling, general, and administrative expenses were 8 million in fiscal year 2016 and improved by nearly 500million from a year ago, mostly driven by lower customer care and marketing expenses.Cost of products of 7.1 billion in the year increased by 1.3 billion from a year ago, mostly driven by thesignificant increase in the installment billing mix of sales from the prior year.We continue to have good momentum in our cost transformation as we head into fiscal year 2017 and we arealready developing initiatives for additional expense reduction in 2018 and beyond.Now turning to slide 25, our adjusted EBITDA of nearly 10 billion for the year was the highest in nine years andimproved by 1.8 billion or 22% compared to a year ago, primarily driven by the expense reductions and thegrowing operating revenues that I discussed.Operating income of 1.8 billion for fiscal year 2016 was the highest in 10 years and improved by a multiple of sixtimes from a year ago.Sprint's net loss in the year was 1.2 billion or 0.30 per share, improved by 40% compared to a net loss of 2billion or 0.50 per share in the year-ago period.Turning to slide 26, total cash capital expenditures were 3.9 billion in fiscal year 2016 compared to 7 billion infiscal year 2015. Excluding capitalized device leases, cash capital expenditures were 2 billion in fiscal year 2016compared to 4.7 billion in the year-ago period with a year-over-year decline driven by lower capital intensity as aresult of software-driven deployments of capacity through carrier aggregation and surgical deployment of smallcell.Net cash provided by operating activities was 4.2 billion for fiscal year 2016 compared to 3.9 billion a year ago.Adjusted free cash flow was 607 million for fiscal year 2016 compared to a negative 1.4 billion last year.81-877-FACTSET www.callstreet.comCopyright 2001-2017 FactSet CallStreet, LLC

Sprint Corp. (S)Corrected TranscriptQ4 2016 Earnings Call03-May-2017Shifting focus to liquidity on slide 27, we ended the fiscal year with total general purpose liquidity of 10.9 billion,including 8.3 billion of cash, cash equivalents and short-term investments.In addition, we still have 1.2 billion in undrawn availability under a network vendor financing facility that can beused to finance the purchases of 2.5 GHz network equipment.During the quarter we replaced our 3.3 billion unsecured revolving bank credit facility with a new 6 billionsecured credit facility consisting of a 4 billion seven-year term loan B and a 2 billion four-year revolving bankcredit facility.This represents the latest example of our strategy to diversify our sources of financing in order to lower our cost ofcapital and future interest expense. When you combine this with our previously placed 3.5 billion of spectrumbacked notes, we have raised 7.5 billion in two transactions with two things in common: both have an effectiveinterest rate in the mid-3% range, and both transactions were multiple times oversubscribed, demonstrating arenewed demand for Sprint paper as a result of our turnaround execution and improved balance sheet.Conversely, we have retired 3.3 billion of bonds that matured in the last two quarters, with coupons between 6%to 14.75%, which is a cost of debt two to four times higher than the new money coming in.Also, as referenced in our 10-Q last quarter, we amended our off-balance sheet receivable facility during thefourth quarter such that all baskets within that facility are now accounted for on balance sheet just as the leasereceivables were previously.With that change, all of our financing is now on balance sheet and hopefully simplifies your understanding andtracking of all our financing obligations. Having diversified our sources of funding and building liquidity, we arenow delivering on the second phase which is to materially reduce interest expense.The third phase is to materially delever the company and reduce our net debt through sustained free cash flowgeneration.As we build on a very successful year in fiscal year 2016, let's turn the page to our fiscal year 2017 guidance onslide 28. We expect adjusted EBITDA to be 10.7 billion to 11.2 billion in fiscal year 2017, primarily driven by acontinuous focus on significant cost reduction. Given the improved profitability and momentum of the businesstoday we feel we are in the right phase of our turnaround to reinvest a part of our gross expense reduction in 2017back into growth platforms for the business, including retail distribution, network densification, digitalization ofsales and care and prepaid growth initiatives.Operating income is expected to be between 2 billion to 2.5 billion in fiscal year 2017. We expect non-cashgains from spectrum swaps in fiscal year 2017 similar to the 350 million we recognized in fiscal year 2016. Asyou know we exclude this non-cash spectrum gain from our adjusted EBITDA, but it does still impact our reportedoperating income just as it did last year.Regarding our guidance for cash capital expenditure excluding these devices, we expect spending to doubleyear-over-year to approximately 3.5 billion to 4 billion as we ramp up our densification and utilize the expandedtoolbox of the various cost-efficient coverage and capacity options. We expect network CapEx to remain aroundthis level for the next three years, but could potentially increase if we see the right opportunity to efficientlyaccelerate our network plan.91-877-FACTSET www.callstreet.comCopyright 2001-2017 FactSet CallStreet, LLC

Sprint Corp. (S)Corrected TranscriptQ4 201

Vice President & Head of Investor Relations, Sprint Corp. Raul Marcelo Claure President, Chief Executive Officer & Director, Sprint Corp. Masayoshi Son Chairman, Sprint Corp. Tarek A. Robbiati Chief Financial Officer, Sprint Corp. John C. B. Saw, Ph.D. Chief Technology Officer, Sprint Corp.