Sprint Nextel Corp added mobile subscribers for the first quarter in more than three years, sending its shares up 3.2 percent in premarket trading.

The No. 3 U.S. mobile service added 58,000 subscribers in the quarter, ahead of the average expectation for almost 17,000 customer additions from eight analysts contacted by Reuters.

While the customer number was tiny compared with growth at bigger rivals Verizon Wireless and AT&T Inc, it marked a milestone for Sprint, which last reported contract customer growth in the second quarter of 2007.

They're definitely turning the corner, said Pacific Crest analyst Steve Clement.

While several analysts expect Sprint to revert to a customer loss again this quarter, they applauded its promise to report subscriber additions for the full year 2011, which would mark the first full year of growth since 2006.

It does indicate management has a high level of confidence, Mizuho analyst Michael Nelson said.

Chief Executive Dan Hesse said he was pleased with the results, but cautioned that Sprint still has a lot more work to do to improve the business.

I'm not declaring mission accomplished yet, far from it, Hesse told investors on a conference call.

Analysts expect Sprint to revert to subscriber losses in the current quarter partly because Verizon Wireless launches the Apple Inc iPhone.

The venture of Verizon Communications and Vodafone Group Plc , started selling iPhone in its stores at the same time on Thursday as Sprint reported its earnings.

Sprint's loss narrowed slightly to $929 million, or 31 cents per share, in the fourth quarter from $980 million, or 34 cents per share, a year earlier.

Excluding unusual items, the loss would have been 29 cents per share in comparison with the average analyst estimate for a loss of 30 cents per share, according to Thomson Reuters I/B/E/S.

Revenue rose to $8.3 billion from $7.87 billion and exceeded the analysts' average estimate of $8.15 billion.

Sprint said 2011 capital spending would be about $3 billion and it expects to continue to generate free cash flow in 2011. Free cash flow refers to profit excluding amortization and depreciation, but including capital expenditures.

Sprint shares were up 15 cents at $4.49 in premarket.

(Reporting by Sinead Carew; editing by Lisa Von Ahn and Derek Caney)

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