Virgin Mobile loses customers but income skyrockets to $17.2 million

Virgin Mobile has published its second quarter results and while the company lost 269,000 net customers, doubling its loss since the same quarter last year, the company's income skyrocketed to $17.2 million from $3.5 million a year earlier. The company saw 583,000 gross customer additions and its churn rate dropped to 5.3 percent from 5.6 percent the during the same quarter in the prior year.

The customer loss is likely attributed to the ongoing competition between prepaid carriers who are risking their margins by dropping prices and adding service features to attract customers, which we reported on earlier this morning.

Last week Sprint announced plans to acquire Virgin Mobile USA for $483 million in an effort to boost its prepaid offerings. Sprint will retire Virgin's outstanding debt of $248 million net of cash and Virgin shareholders will receive Sprint stock equivalent to $5.50 per share of Virgin Mobile. The acquisition is pending Virgin shareholder approval and regulatory approval.