This year hasn’t been an especially fruitful one for Sprint Corp (NYSE:S) shareholders. After rallying more than 130% in 2016 in anticipation of a corporate turnaround, as of Monday afternoon Sprint stock was down just a bit year-to-date largely because evidence of that turnaround remained obscured.

S stock investors are, or were anyway, starting to have second thoughts about the future of the wireless company.

Tuesday morning’s fiscal Q1 report should erase at least some of that concern. Not only did the company dish out another progressive quarter, the pace of that progress seems to be accelerating, inspiring more than a 2% improvement in the value of Sprint stock early Tuesday.

Sprint Earnings Recap

For the quarter ending in June, the nation’s fourth-biggest wireless service provider turned $8.16 billion worth of revenue into a per-share profit of 5 cents. Analysts were modeling a loss of 1 cent per share of Sprint stock and sales of $8.19 billion. The company lost 8 cents per share in the comparable quarter of the prior year, when it did $8.01 billion worth of business.

The company added 88,000 postpaid customers during the quarter, marking the eighth straight quarter of growth on the front. The 35,000 prepaid subscribers was a considerable turnaround from the 306,000 prepaid subscribers it lost in the same quarter a year earlier.

CEO Marcelo Claure commented on the results:

“Sprint reached an important milestone this quarter by returning to profitability for the first time in three years. This represents the progress of a turnaround journey that has delivered improvements in postpaid phone and prepaid customer growth, a return to top-line growth, and a significantly transformed cost structure.”

What Claure didn’t discuss was the slight decrease in the company’s total liabilities. Although the slide from year-ago levels — $66.3 billion to $64.3 billion — is modest (and mostly driven by the decline of long-term debt and capital lease obligations), that modest progress addresses one of the key sore spots with investors of late.

So too does another round of successful cost-cutting. Total net operating expenses fell from year-ago levels of $7.65 billion to only $7.0 billion, setting the stage for a swing to a profit of $206 million and $1.28 billion worth of operating cash flow. Although free cash flow was down $392 million versus an increase of $1.14 billion in the first quarter of 2017, that’s only because Sprint culled its debt issuance by $2.3 billion year-over-year, retiring more than it issued in the recently completed quarter.

S Stock: Running Out of Options

For as much effort as Sprint has put into its turnaround plans, they still haven’t been enough, forcing Claure to look at a variety of options that will buy the company time to keep working on its rebound.

One of them has been a potential partnership with cable television company Charter Communications, Inc. (NASDAQ:CHTR) … a deal Charter says it’s not interested in.

Pairing the two companies up would create a strong so-called “triple play” threat by offering customers a one-stop shop to buy bundled cell phone, cable and internet services akin to what AT&T Inc. (NYSE:T) offers customers now that it owns DirecTV.

Charter already has such a budding relationship with a much more stable Verizon Communications Inc. (NYSE:VZ) though, with the duo aiming to co-launch a wireless service next year. The latest twist? Majority owner of Sprint, SoftBank Group Corp (OTCMKTS:SFTBF), may acquire Charter just to enact its acquisition of Sprint.

The company had also been in talks with peer and rival T-Mobile US Inc (NASDAQ:TMUS), which could arguably do more with Sprint’s huge cache of licensed spectrum than Sprint could do with those radio frequencies on their own. At the same time, T-Mobile could make good use of Sprint’s 5G technology, as T-Mobile’s 5G presence and potential is lacking.

Problem: As long as Sprint is talking to other companies about partnering up, T-Mobile isn’t talking to Sprint.

Whatever potential combination ends up taking shape (if any), it’s clear now that Sprint’s new-found viability not only buys it some time to shop around for the right partnership, but makes it more of an asset and less of a liability to a potential buyer.

Looking Ahead for Sprint Stock

Calling a spade a spade, it’s still a little ugly. While Claure is culling some costs, others continue to rise in step with rising revenue.

Nevertheless, on balance, Sprint continues to validate last year’s heroic rise from the stock.

For the quarter currently underway, analysts are calling for a loss of 2 cents per share of Sprint stock on revenue of $8.3 billion. That’s barely measurably better than the comparable year-ago levels. For the full year, Sprint is expected to turn $33.57 billion worth of revenue into a loss of 6 cents per share. Again that top line is almost imperceptibly higher, though the year-over-year loss is expected to be dramatically culled from the prior year’s loss of 28 cents per share.

Of course, those outlooks are apt to change now that the company’s first fiscal report and full-year outlook is in analysts’ hands.

Most revisions should be bullish, as Sprint’s guidance was better than anticipated. Although the company doesn’t provide revenue or per-share earnings guidance, it’s implying growth through rising operating guidance. It had previously called for 2017 non-GAAP income of between $2.0 billion and $2.5 billion, but upped the lower end of that suggested range to $2.1 billion. Even just reaching the low end of that guidance would be a considerable turnaround from 2016’s operating income of $1.76 billion, saying (if nothing else) Sprint’s at least pointed in the right direction.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.