The bad news keeps on coming for Samsung Electronics (SSNLF) . After recognizing the failure of its flagship Galaxy Note 7 smartphone, the company slashed its third-quarter guidance. Samsung lowered its third-quarter operating profit outlook to 5.2 trillion Korean won ($4.7 billion) from 7.8 trillion and cut its sales estimate for the period to 47 trillion won from 49 trillion won. The revised guidance comes after Samsung said it would halt production of the Galaxy Note 7 following reports that batteries had exploded and replacements handsets had spontaneously caught fire.
Sprint (S) shares were rising in early trading on Wednesday following news that the company is preparing to mortgage its wireless airwaves. According to the Wall Street Journal, Sprint is looking to mortgage more than 10% of its wireless airwaves to raise needed cash to fund its business. The company believes the section of airwaves is worth more than $14 billion, but sources told the Journal that Sprint will likely aim to raise about $3.5 billion at first. The company could announce the details of the plan as early as this week, the Journal reported.
In earnings news, Ericsson (ERIC) shares were taking a hit in premarket trading, down more than 16%, after reporting that third-quarter earnings would be well below expectations. The Swedish telecom equipment company blamed weaker demand for mobile broadband products, among other "negative trends." Ericsson said third-quarter revenue had slipped by 14% year on year to 51.1 billion Swedish kronor ($5.8 billion), driven by a 19% decline in its segment networks business. Gross margin also declined to 28% following lower volumes in Segment Networks, lower mobile broadband capacity sales, and higher share of services sales.
"More in-depth analysis remains to be done, but current trends are expected to continue short-term," said CEO Jan Frykhammar in a statement. "We will continue to drive the ongoing cost program and implement further reductions in cost of sales to meet the lower sales volumes."
Finally, Amazon (AMZN) is launching its paid streaming music service. Amazon Music Unlimited is joining the increasingly crowded field and will compete against Apple (AAPL) Music and Spotify. Amazon's service will cost $8 per month, or $80 a year, for members of Amazon's Prime loyalty program. Non-Prime members will pay $10 a month, while owners of Amazon's Echo will be able to get the service on one device for $4 per month. (Amazon is a holding in TheStreet's Growth Seeker portfolio; Apple is a holding in Jim Cramer's Action Alerts PLUS portfolio).