Clearwire said Tuesday that it expects fourth-quarter net subscriber additions to ramp as it rolls out its 4G WiMax service into more markets. That tipping point will be critical to the company's success--and possibly its survival.
On a conference call with analysts, Clearwire CEO Bill Morrow said that he was pleased with WiMax uptake in new markets such as Las Vegas. Morrow added that "fourth-quarter net subscriber additions will be higher than all 2009 quarters combined."
That's good since Clearwire projected a cash burn of $1.5 billion to $1.9 billion for 2009. So far the company has burned through $646 million (statement). Clearwire had $2.5 billion in cash as of June 30. If the fourth-quarter 4G customers don't roll in, Clearwire may be cutting it close with its cash burn. Morrow and CFO David Sach cited Clearwire's strong balance sheet, but Moody's has it on its "bottom rung" list of companies with weak liquidity.
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