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Sprint Corp. on Tuesday boosted its guidance for the year and said its turnaround is starting to take hold, as it posted a loss for the latest quarter that wasn't as deep as Wall Street was expecting.

Shares jumped 16% in premarket trading to $2.92.

Sprint said it now expects earnings before interest, taxes, depreciation and amortization for its 2015 year to be $7.7 billion to $8 billion, up from its previous guidance of $6.8 billion to $7.1 billion.

The company also said it added 501,000 postpaid net subscribers—its most profitable type of customer—during the quarter, up sharply from the 30,000 adds in the year-earlier period. Still, those gains come at a cost as the company launched its most-aggressive price offer ever in the quarter—promising switchers half off their monthly price of wireless service.

Total net additions were 491,000, down from 967,000 in the year-earlier period.

Japanese technology conglomerate SoftBank bought control of the American wireless carrier in 2013 for about $22 billion with plans to shake up the business and steal customers, but the turnaround has faced obstacles.

On Tuesday, Sprint said it is on track to exceed its cost reduction target for fiscal 2015. It said it cut $500 million in the quarter, bringing the year-to-date total to $800 million from service and selling, general and administrative expenses.

"Our transformation is taking hold and the momentum is accelerating," Chief Financial Officer Tarek Robbiati said.

In October, the company said it was preparing to cut as much as $2.5 billion in costs in the next six months, as the struggling wireless carrier steps up its belt-tightening. Mr. Robbiati said in an internal memo those cuts would inevitably result in job reductions. Sprint employed about 31,000 people at the end of March, according to filings.

In all for the period ended Dec. 31, Sprint reported a loss of $836 million, or 21 cents a share, compared with a prior-year loss of $2.4 billion, or 60 cents a share, as the company had taken more than $2 billion of impairments during that quarter.

Revenue skidded 9.7% to $8.1 billion.

Analysts polled by Thomson Reuters had forecast a loss of 25 cents a share and revenue of $8.23 billion.

Sprint's churn rate for the latest quarter, a measure of service cancellations, for mainstream customers improved 68 basis points to 1.62%.

Write to Anne Steele at Anne.Steele@wsj.com

(END) Dow Jones Newswires

January 26, 2016 08:55 ET (13:55 GMT)

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