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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): April 26, 2000 (April 25,
2000)
NEXTEL COMMUNICATIONS, INC.
(Exact Name of Registrant as Specified in Its Charter)
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Delaware 0-19656 36-3939651
(State or Other Jurisdiction of Incorporation) (Commission File Numbers) (I.R.S. Employer Identification Nos.)
2001 Edmund Halley Drive, Reston, Virginia 20191
(Address of Principal Executive Offices) (Zip Code)
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Registrants' Telephone Number, Including Area Code: (703) 433 - 4000
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. OTHER EVENTS.
Recent Developments
NEXTEL INTRODUCES NEXTEL ONLINE(SM)
On April 25, 2000, Nextel issued a press release
announcing that it will begin rolling out its Nextel
Online(sm) wireless Internet services as more fully described
in the press release, a copy of which is filed as Exhibit 99.1
hereto and which information is incorporated herein by
reference.
NEXTEL REPORTS FIRST QUARTER 2000 RESULTS
On April 26, 2000, Nextel issued a press release
announcing its financial results and other data for the
quarter ended March 31, 2000 as more fully described in the
press release, a copy of which is filed as Exhibit 99.2 hereto
and which information is incorporated herein by reference.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
(a) Financial Statements of Business Acquired.
Not applicable.
(b) Pro Forma Financial Information.
Not applicable.
(c) Exhibits.
The following exhibits are filed with this report:
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Exhibit No. Exhibit Description
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99.1 Press Release dated April 25, 2000
99.2 Press Release dated April 26, 2000
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NEXTEL COMMUNICATIONS, INC.
/s/ THOMAS J. SIDMAN
----------------------------------------------------
By: Thomas J. Sidman
Senior Vice President and General Counsel
Date: April 26, 2000
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EXHIBIT INDEX
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Exhibit No. Exhibit Description
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99.1 Press Release dated April 25, 2000
99.2 Press Release dated April 26, 2000
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Exhibit 99.1
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NEWS RELEASE
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[NEXTEL LOGO]
NEXTEL COMMUNICATIONS, INC.
2001 Edmund Halley Drive
Reston, VA 20191
MEDIA: BEN BANTA (703) 433-4700
INVESTORS: PAUL BLALOCK (703) 433-4300
NEXTEL INTRODUCES NEXTEL ONLINE(SM):
WIRELESS INTERNET SERVICE FOR BUSINESS
NEXTEL ONLINE FEATURES ALWAYS-CONNECTED INTERNET ACCESS; A FOUR-IN-ONE WIRELESS
COMMUNICATIONS TOOL; AND A SUITE OF WIRELESS APPLICATIONS DEVELOPED JUST FOR
BUSINESS
RESTON, Va., April 25, 2000 -- Nextel Communications, Inc. (NASDAQ: NXTL) today
announced that it will begin rolling out Nextel Online(sm) wireless Internet
services in 43 major markets including more than 750 cities across the country.
Nextel Online service is scheduled to become available in all Nextel markets by
mid-year.
"With the arrival of Nextel Online, business customers can now easily receive
and act on the critical information they need to do business while they are away
from the office," said Tim Donahue, president and CEO, Nextel Communications,
Inc. "Nextel Online is a result of our company's commitment to help our mobile
business customers be more productive in a world that values speed."
With Nextel Online, Nextel now offers a wireless phone that serves as a
four-in-one wireless business communication tool. Nextel's Internet-capable
"plus" series phones, manufactured by Motorola, integrate wireless Internet
service, Nextel Direct Connect(R) digital two-way radio service, digital
cellular service, and text/numeric paging into one phone. Today, approximately 2
million Nextel customers own "plus" series phones.
Nextel Online service rate plans feature simple, flat-rate pricing and include
unlimited access to MSN Mobile and Nextel alliance web sites. Plans begin at
$14.95 per month in addition to a customer's existing Nextel rate plan.
Using Phone.com(TM)'s UP.Link(TM) Server and UP.Browser(TM) microbrowser,
Nextel, in a partnership with Cisco for mobile Internet Protocol (IP) networking
has delivered the wireless industry's only integrated, packetized voice and data
service. Unlike other wireless data services where you have to "dial in" to
access the Internet, Nextel Online customers have immediate access to the most
reliable wireless data network in the country allowing instant connectivity to
the Internet so they are never far away from their messages, business
information and wireless-enabled applications.
NEXTEL ONLINE INCLUDES UNLIMITED ACCESS TO ONLINE CONTENT AND COMMERCE
Nextel Online customers can create their own personalized web portal accessible
by a personal computer or Internet-capable Nextel phone using the myNextel.com
web portal. Co-branded with MSN, this web portal features business news and
information from MSNBC and provides access to MSN services such as MSN
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Hotmail, MSN MoneyCentral, Expedia.com, and MSN Yellow Pages business directory
and Hotmail. Users can customize the site so that business information that is
important to them is sent directly to their phone anytime, anywhere on the
Nextel National Network.
Amazon Anywhere allows Nextel customers to conveniently shop and open new
accounts at Amazon.com, the leading on-line retailer, via their Nextel
Internet-capable phone. Customers can make purchases using Amazon's easy and
secure 1-Click(sm) shopping feature available at Amazon.com, including books,
videos, software, tools, hardware and more. Customers can also check the status
of pending orders and search by keyword to view product information including
details, reviews, price, shipping and customer comments.
NEXTEL ONLINE OFFERS ONLINE PRODUCTIVITY SOLUTIONS
List Manager is the first of many planned productivity solutions, and will allow
customers to manage their Nextel phone lists and Nextel Direct Connect private
ID and group lists from their desktop PC or from their Internet-capable Nextel
phone. List Manager synchronizes information over the air and allows an
administrator to manage multiple phone lists at once.
NEXTEL ONLINE FEATURES WIRELESS BUSINESS APPLICATIONS AND CONNECTIVITY SOLUTIONS
Nextel Online features wireless business applications developed to increase
productivity and customer satisfaction by moving data instantly between mobile
workers and their headquarters. Wireless business and mobile connectivity
applications available in the initial launch phase through Nextel Online will
include:
- - eDispatch, a web-based productivity tool for the transportation,
construction and field service industries that allows dispatchers to
receive job status and job completion information in near real-time from
the field, enabling field workers to receive, acknowledge and close out
work orders from the road. Service rate plans for eDispatch begin at
$39.95 per month per unit.
- - IBM Mobile Connect, a component of IBM's Websphere Everyplace Suite, will
allow mobile professionals to access e-mail, calendar, contacts and tasks
using a Nextel Internet-capable phone as a wireless modem when connected
to their personal digital assistant (PDA). Corporate customers can
establish dial-up access accounts for $9.95 per month using minutes of
airtime from their rate plan.
The Nextel Developers Program currently consists of more than 200 organizations
that have registered and qualified to develop wireless applications for vertical
markets such as professional medical services and the building and construction
industry. Nextel plans to announce additional wireless applications in the
coming months that it expects will become available from participants in this
program.
"Extending the Internet into the wireless environment is a logical step for
businesses around the world," said Iain Gillott, vice president of Worldwide
Consumer & Small Business Telecom at IDC. "Obvious applications such as e-mail
and calendaring will be quickly supplemented with wireless commerce, location
services, and vertical applications."
Additionally, through Nextel's web site, http://www.nextel.com, customers can:
get valuable information about Nextel's services, including current rate plans,
promotions, user guides, and interactive product demos; administer their
accounts, including the ability to view and pay their Nextel bill online, sign
up for Nextel service, purchase new phones and accessories; and manage their
mobile services such as set alerts, filter mail and manage online community
information.
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"Nextel Online extends the power of the desktop and the web to today's mobile
worker," added Donahue. "With this service, our customers now have access to a
suite of business applications developed to help them transact business no
matter where they are on the Nextel National Network."
All Nextel Online customers will be supported by Nextel Online customer service
staff members that have been specially trained to field data related customer
service calls.
Nextel Online service will be rolled out initially in 43 major markets and more
than 750 cities across the country including: Atlanta, Chicago, Denver,
Greensboro N.C., Houston, Los Angeles, New Orleans, New York, Philadelphia, San
Francisco, Seattle and Washington/Baltimore. Next week, service also will be
rolled out in the Boston and Providence metropolitan areas.
Nextel Communications Inc., headquartered in Reston, Va. is a leading provider
of fully integrated wireless communications and has built the largest guaranteed
all-digital wireless network in the United States that covers thousands of
communities across the United States. Nextel and Nextel Partners Inc. currently
serve 96 of the top 100 U.S. markets. The Nextel National Network offers a fully
integrated wireless communications tool with digital cellular, text/numeric
paging and Nextel Direct Connect(R) - a digital two-way radio feature. In
addition, through Nextel International Inc., Nextel has wireless operations and
investments in Canada, Mexico, Argentina, Brazil, the Philippines, Peru, Japan
and Shanghai, China. Please visit our web page at http://www.nextel.com.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995: A number of the matters and subject areas discussed in this press release
that are not historical or current facts deal with potential future
circumstances and developments. The mobile computing services, wireless Internet
access and related new products discussed above are all new offerings that are
planned for commercial introduction in the near future. As such, they remain
subject to risks and delays of product and services offerings in their early
commercial introduction stages, such as those involving the integration of new
and existing product and service offerings, the effectiveness of marketing and
other programs designed to familiarize customers and potential customers with
the newly introduced features and functionality and the efficiency of related
customer service and other backroom support services for the new offerings. Such
new product and service offerings, when commercially introduced, also may be
subject to coverage and capacity limitations in certain geographic areas and the
Nextel National Network. The discussion of such matters and subject areas is
qualified by the inherent risks and uncertainties surrounding future
expectations concerning Nextel's digital mobile network business generally.
Customer acceptance and/or commercial viability of such new product and service
offerings will be dependent on a variety of factors, including the development
and availability of related products and applications that meet customer needs
and preferences, the quality and reliability of the applicable services and
products, and Nextel's ability to deploy these new product and service offerings
either to reduce its own costs or to price such offerings to be a source of
incremental revenue. Nextel has attempted to identify, in context, certain of
the factors that it currently believes may cause actual future experience and
results in its digital mobile network business (including, when commercially
introduced, the new product and service offerings discussed above) to differ
from Nextel's current expectations regarding such relevant matters or subject
areas, and such risks and uncertainties are described from time to time in
Nextel's reports filed with the Securities and Exchange Commission, including
Nextel's Annual Report on Form 10-K for the fiscal year ended December 31, 1999.
# # #
Nextel, the Nextel logo, Nextel Online and Nextel Direct Connect are trademarks
and/or service marks of Nextel Communications, Inc.
Motorola, i1000plus, i700plus, i500plus are registered trademarks of Motorola,
Inc. All other trademarks are property of their respective company.
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Exhibit 99.2
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NEWS RELEASE
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[NEXTEL LOGO]
NEXTEL COMMUNICATIONS, INC.
2001Edmund Halley Drive
Reston, VA 20191
703 433-4000
CONTACTS:
INVESTORS: PAUL BLALOCK (703) 433-4300
MEDIA: BEN BANTA (703) 433-4700
NEXTEL REPORTS RECORD FIRST QUARTER 2000 RESULTS
- 634,000 GLOBAL DIGITAL NET ADDITIONS -
- APPROXIMATELY $1.1 BILLION IN TOTAL REVENUES FOR THE QUARTER -
- LAUNCHES NEXTEL WORLDWIDE(SM) AND NEXTEL ONLINE(SM) SERVICES -
RESTON, Va. - April 26, 2000 - Nextel Communications, Inc., (NASDAQ: NXTL) today
reported its financial results for the first quarter of 2000 including the
addition of a record 540,300 domestic digital subscribers, and 93,700
proportionate subscribers for Nextel International. Nextel ended the first
quarter with a worldwide subscriber base of approximately 5.6 million global
digital subscribers.
"Accelerating momentum in the wireless industry coupled with our unique business
focus has produced our best quarter ever," said Tim Donahue, Nextel's president
and CEO. "Nextel's first quarter global subscriber growth significantly exceeded
expectations. The near term prospects for Nextel have never been greater with a
myriad of great business opportunities tied into our differentiated approach to
business communications services. Global roaming, wireless internet services and
emerging broadband opportunities clearly make this the most exciting and
opportune time for Nextel."
Consolidated revenue for the first quarter of 2000 grew 63% to $1.08 billion
when compared with $664 million generated during the first quarter of 1999.
Domestic revenue was $1.03 billion for the quarter, while international revenue
was $47 million. Nextel's average monthly revenue per domestic subscriber unit
remained among the best in the wireless industry at approximately $72 in the
first quarter. The monthly churn rate for the first quarter was approximately 2%
for domestic customers, one of the best levels in the wireless industry.
"For the fifth consecutive quarter Nextel has attracted greater net additions
while maintaining the highest subscriber quality in the industry," said Steve
Shindler, Nextel's CFO. "With more than $18 of domestic monthly cash flow per
subscriber and an estimated $3,600 of lifetime revenue per subscriber Nextel
continues to set the pace in the emerging digital wireless industry. Nextel
International is beginning to see the same type of improvements in Latin America
that our domestic operations experienced over the last few years, supporting our
belief that the value of Nextel's integrated services transcends national
boundaries."
Nextel continued improvement in operating cash flow (earnings before interest,
taxes, depreciation and amortization) during the quarter. Operating cash flow
from consolidated operations was $228
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million in the first quarter - more than six times higher than 1999's
first-quarter cash flow of $35 million. In the first quarter of 2000, domestic
operations produced $262 million in operating cash flow, a 220% improvement over
1999's first quarter domestic operating cash flow of $82 million. International
operations produced a cash flow loss of $34 million in the first quarter of
2000, a 28% improvement over 1999's first quarter loss of $47 million.
The consolidated first quarter 2000 net loss per share before one-time charges
was $0.83 per share - a 50% improvement when compared with the $1.66 per share
loss in the first quarter of 1999. In the first quarter of 2000, the
consolidated net loss attributable to common stockholders was $435 million, or
$1.17 per share and includes one-time charges of $127 million, or $0.34 per
share for the early retirement of debt and for the conversion of debt
securities.
The per share amounts mentioned above are based upon a weighted average number
of shares outstanding of 370,759,000 and do not reflect the effect of the
proposed 2-for-1 stock split which Nextel announced on February 22, 2000.
Shareholders are scheduled to vote on an increase in authorized shares required
to accomplish the stock split at the upcoming shareholder meeting on May 25th.
Domestic capital expenditures were $661 million in the first quarter of 2000 as
compared with $684 million in the fourth quarter of 1999. International capital
expenditures were $116 million in the first quarter as compared with $50 million
in the fourth quarter of 1999.
Total domestic system minutes of use on the Nextel National Network increased
85% during the quarter when compared with the same period in 1999 to
approximately 6.3 billion total system minutes of use in the first quarter 2000.
During the first quarter, approximately 11 million Internet text messages were
sent on the Nextel National Network, representing a 280% increase over last
year's first-quarter Internet text messages. Nextel ended the first quarter with
approximately 1.9 million data-capable handsets in service.
On April 3, 2000, Nextel announced the launch of its Nextel Worldwide service
providing customers a dual mode iDEN/GSM handset with the ability to use one
phone and have one number in more than 65 countries including 18 of the world's
25 largest cities. Earlier this week Nextel announced the launch of its Nextel
Online and wireless internet services in 45 major markets and more than 750
cities across the country. Visit our website for more information.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995 A number of the matters and subject areas discussed in this press release
that are not historical or current facts deal with potential future
circumstances and developments. The discussion of such matters and subject areas
is qualified by the inherent risks and uncertainties surrounding future
expectations generally, and also may materially differ from Nextel and Nextel
International's actual future experience involving any one or more of such
matters and subject areas. Nextel and Nextel International have attempted to
identify, in context, certain of the factors that they currently believe may
cause actual future experience and results to differ from Nextel's and/or Nextel
International's current expectations regarding the relevant matter or subject
area. Such risks and uncertainties include those that are described from time to
time in Nextel's and Nextel International's reports filed with the SEC,
including Nextel's and Nextel International's Annual Report on Form 10-K for the
fiscal year ended December 31, 1999.
Nextel Communications, Inc., based in Reston, VA, is the leading provider of
fully integrated wireless communications and has built the largest guaranteed
all-digital wireless network in the United States covering thousands of
communities across the United States. Nextel and Nextel Partners, Inc.,
currently serve 96 of the top 100 U.S. markets. Through recent market launches,
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Nextel and Nextel Partners' service is available today in areas of the U.S.
where approximately 190 million people live or work. The Nextel National Network
offers a fully integrated wireless communications tool with digital cellular,
text/numeric paging and Nextel Direct Connect(sm) - a digital two-way radio
feature. In addition, through Nextel International, Inc., Nextel has wireless
operations and investments in Canada, Mexico, Argentina, Brazil, the
Philippines, Peru, Japan and Shanghai, China. Please visit our website at
http://www.nextel.com.
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NEXTEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(Unaudited)
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THREE MONTHS
ENDED MARCH 31,
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2000 1999
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OPERATING REVENUES $ 1,079 $ 664
OPERATING EXPENSES
Cost of revenues 214 163
Selling, general and administrative 637 466
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EBITDA 228 35
Depreciation and amortization 280 228
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OPERATING LOSS (52) (193)
Interest expense (278) (198)
Interest income 83 4
Debt conversion expense (23) --
Other expense, net (17) (62)
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LOSS BEFORE INCOME TAX BENEFIT (287) (449)
Income tax benefit 8 10
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LOSS BEFORE EXTRAORDINARY ITEM (279) (439)
Extraordinary loss from extinguishment of debt (104) --
Mandatorily redeemable preferred stock dividends (52) (46)
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LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (435) $ (485)
======== =========
LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS, BASIC AND DILUTED:
Loss before extraordinary item attributable to common stockholders $ (0.89) $ (1.66)
Extraordinary item (0.28) --
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$ (1.17) $ (1.66)
======== =========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 371 292
========= =========
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SELECTED BALANCE SHEET AND OTHER DATA
(in millions, except unit data)
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MARCH 31, DECEMBER 31,
2000 1999
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(Unaudited)
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CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS, including
restricted portion of $74 and $1,365 $ 6,340 $ 5,808
PROPERTY, PLANT AND EQUIPMENT, NET 6,718 6,152
INTANGIBLE ASSETS, NET 4,549 4,551
TOTAL ASSETS 19,596 18,410
LONG-TERM DEBT, excluding current portion 11,840 9,760
MANDATORILY REDEEMABLE PREFERRED STOCK 1,751 1,770
TOTAL STOCKHOLDERS' EQUITY 2,562 2,574
DIGITAL UNITS IN SERVICE:
Domestic 5,056,000 4,515,700
========== ==========
International - total 1,474,400 1,245,600
========== ==========
International - proportionate 497,200 403,500
========== ==========
Global 5,553,200 4,919,200
========== ==========
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THREE MONTHS ENDED
MARCH 31, DECEMBER 31,
2000 1999
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(Unaudited)
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CAPITAL EXPENDITURES:
Domestic $ 661 $ 684
International 116 50
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Total capital expenditures $ 777 $ 734
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