8-K

UNITED STATES
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): July 29, 2010

NII HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware	000-32421	91-1671412
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1875 Explorer Street, Suite 1000 Reston, Virginia	20190
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (703) 390-5100

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

     o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

     o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

     o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

     o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

Second Quarter 2010 Results. On July 29, 2010, NII Holdings, Inc. issued a press release announcing certain financial and operating results for the quarter ended June 30, 2010. A copy of the press release is furnished as Exhibit 99.1 to this report and is incorporated by reference into this Item 2.02.

Item 9.01. Financial Statements and Exhibits.

     (d) Exhibits.

Exhibit No.	Description
99.1	Press Release dated July 29, 2010.

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 hereunto duly authorized.

	NII HOLDINGS, INC. (Registrant)
Dated: July 29, 2010	By:	/s/ Gary D. Begeman
		Gary D. Begeman
		Vice President, General Counsel and Secretary

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated July 29, 2010.

EX-99.1

Exhibit 99.1

NII Holdings, Inc.
1875 Explorer Street, Suite 1000
Reston, VA. 20190
(703) 390-5100
http://www.nii.com

Investor Relations: Tim Perrott
(703) 390-5113
tim.perrott@nii.com

Media Relations: Claudia E. Restrepo
(786) 251-7020
claudia.restrepo@nii.com

NII HOLDINGS ANNOUNCES STRONG RESULTS FOR
SECOND QUARTER 2010

Company achieves strong Operating Income Before
Depreciation and Amortization

Customer base surpasses 8 million subscribers

Company raises full year guidance

• Consolidated operating revenues of $1.35 billion

• Consolidated operating income before depreciation and amortization, or OIBDA, of $348 million

• Net subscriber additions of 392,000

• Consolidated operating income of $213 million and consolidated net income of $75 million, or $0.45 per basic share

RESTON, Va. — July 29, 2010 — NII Holdings, Inc. [NASDAQ: NIHD] today announced its consolidated financial results for the second quarter of 2010. During the quarter, the Company added 392,000 net subscribers to its network, bringing its ending subscriber base to nearly 8.2 million, a 22% increase in the ending subscriber base compared to the end of the second quarter of 2009. Financial results for the quarter included consolidated operating revenues of $1.35 billion, a 28% increase compared to the second quarter of 2009, and consolidated OIBDA of $348 million for the quarter, a 30% increase compared to the same period last year. Consolidated OIBDA results for the quarter reflect a $22 million refund of excess fees paid for spectrum use in Mexico while applications to renew certain existing spectrum licenses in the country were pending. Upon their renewal in the second quarter, these licenses became subject to a new reduced fee structure, which resulted in this refund of excess amounts previously paid under the old fee structure. For the second quarter of 2010, the Company generated consolidated operating income of $213 million and consolidated net income of $75 million, or $0.45 per basic share.

The Company continued to invest in the expansion of the coverage and capacity of its networks reporting consolidated second quarter 2010 capital expenditures of $230 million, of which $122 million was invested in Brazil.

“We delivered excellent results for the quarter and the first half of the year highlighted by robust subscriber growth and strong OIBDA results in each of the first two periods,” said Steve Dussek, NII Holdings’ Chief Executive Officer. “These results reflect our balanced approach to growth and profitability, which is built on strategies designed to improve the quality of our customer base and customer retention across all of our markets. We have doubled our subscriber base over the past three years, while maintaining our focus on profitability with OIBDA growing 67% during that period. We believe the opportunity for profitable growth in Latin America is significant, and that our differentiated approach and the high quality of our expanding services will position us to capture this growth in the future,” he added.

NII Holdings’ consolidated average monthly service revenue per subscriber (ARPU) was $47 for the second quarter of 2010, up $3 when compared to the same period last year due primarily to strengthening of local currencies. The Company also reported churn of 1.71% for the second quarter, a 40 basis point improvement over the level reported for the same period last year. Consolidated cost per gross add, or CPGA, was $286 for the second quarter 2010, up $24 compared relative to the second quarter 2009.

In June 2010, we repurchased approximately $100 million face amount of our 3.125% convertible notes due 2012 and $31.4 million face amount of our 2.75% convertible notes due 2025 through a series of open market purchases.

The Company ended the quarter with approximately $3.2 billion in total long-term debt and $2.5 billion in consolidated cash and investments, resulting in net debt at the end of the quarter of approximately $763 million.

“Our strong operational performance in the first half of the year drove outstanding financial results as we generated a 28% increase in revenue and a 30% increase in OIBDA over the second quarter of last year” said Gokul Hemmady, NII’s Vice President and Chief Financial Officer. Economic conditions reflect continued stability in our markets, and when coupled with our intense focus on customer retention, we generated a 22% increase in our consolidated subscriber base compared to the end of the second quarter of 2009. In all, we believe we are well on our way to delivering another year of substantial growth and profitability. As a result of our strong operational trends expected for the remainder of the year, we are raising our 2010 guidance,” he added.

Nextel Mexico and Televisa bid as a consortium in the recent spectrum auctions in Mexico. The consortium was identified by the Cofetel, the Mexican telecommunications regulatory authority, as the high bidder for a 30 MHz nationwide block of spectrum in the AWS spectrum band. As contemplated by the auction rules, the Cofetel has 30 days to verify the results of the auction. After the auction results are verified and the award process is completed, the Company plans to invest in the development and deployment of a 3G network throughout Mexico.

Raising 2010 Guidance

As a result of strong growth trends and positive operational results in the first half of the year, NII Holdings is raising its previously announced 2010 guidance as follows:

Category	February 2010 Guidance	Updated 2010 Guidance
2010 Net Subscriber Additions	1.275 to 1.375 million	1.450 to 1.525 million
2010 Revenue	$5.2 to $5.4 billion	$5.4 to $5.5 billion
2010 Consolidated OIBDA	$1.25 billion to $1.35 billion	$1.350 to $1.425 billion
2010 Consolidated Capital Expenditures	$850 to $950 million	$925 to $975 million

• Our updated OIBDA guidance range includes the impact of approximately $75 million of non-cash equity compensation expense. The updated OIBDA outlook also includes the impact of ongoing start up costs related to the launch of the Company’s third generation network in Peru, start up costs related to the development of the company’s third generation network in Chile and costs related to the market launch of 4 million additional POPs.

• The increase in 2010 capital expenditure guidance relates to higher than expected subscriber growth. Capital expenditures for the full year also include investments relating to the development of the Company’s third generation network in Chile, and the enhancement of the coverage and capacity of our network in Brazil.

The Company’s updated 2010 outlook is predicated on a number of assumptions including the assumption that foreign exchange rates and general economic conditions in its markets will remain relatively stable during the year. In addition to the preliminary results prepared in accordance with accounting principles generally accepted in the United States (GAAP) provided throughout this press release, NII has presented consolidated OIBDA, ARPU, CPGA and Net Debt. These measures are non-GAAP financial measures and should be considered in addition to, but not as substitutes for, the information prepared in accordance with GAAP. Reconciliations from GAAP results to these non-GAAP financial measures are provided in the notes to the attached financial table. To view these and other reconciliations of non-GAAP financial measures that the Company uses and information about how to access the conference call discussing NII’s second quarter 2010 results, visit the investor relations link at<http://www.nii.com>.

About NII Holdings, Inc.

NII Holdings, Inc., a publicly held company based in Reston, Va., is a leading provider of mobile communications for business customers in Latin America. NII Holdings, Inc. has operations in Mexico, Brazil, Argentina, Peru and Chile offering a fully integrated wireless communications tool with digital cellular voice services, data services, wireless Internet access and Nextel Direct Connect^® and International Direct Connect^SM, a digital two-way radio feature. NII Holdings, Inc., a Fortune 500 company, trades on the NASDAQ market under the symbol NIHD and is a member of the NASDAQ 100 Index. Visit the Company’s website at <http://www.nii.com>.

Nextel, the Nextel logo, and Nextel Direct Connect are trademarks and/or service marks of Nextel Communications, Inc.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995. This news release includes “forward-looking statements” within the meaning of the securities laws. The statements in this news release regarding the business outlook, future performance and forward-looking guidance, as well as other statements that are not historical facts, are forward-looking statements. The words “estimate,” “project,” “forecast,” “intend,” “expect,” “believe,” “target,” “providing guidance” and similar expressions are intended to identify forward-looking statements. Forward-looking statements are estimates and projections reflecting management’s judgment based on currently available information and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. With respect to these forward-looking statements, management has made assumptions regarding, among other things, network usage, customer growth and retention, pricing, operating costs, the timing of various events, the economic and regulatory environment and the foreign exchange rates that will prevail during 2010. Future performance cannot be assured and actual results may differ materially from those in the forward-looking statements. Some factors that could cause actual results to differ include the risks and uncertainties relating to the impact of more intense competitive conditions and changes in economic conditions in the markets we serve; the impact on our financial results, and potential reductions in the recorded value of our assets, that may result from fluctuations in foreign currency exchange rates and, in particular, fluctuations in the relative values of the currencies of the countries in which we operate compared to the U.S. dollar; the risk that our network technologies will not perform properly or support the services our customers want or need, including the risk that technology developments to support our services will not be timely delivered; the risk that customers in the markets we serve will not find our services attractive; and the additional risks and uncertainties that are described from in NII Holdings’ Annual Report on Form 10-K for the fiscal year ended December 31, 2009, as well as in other reports filed from time to time by NII Holdings with the Securities and Exchange Commission. This press release speaks only as of its date, and NII Holdings disclaims any duty to update the information herein.

NII HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2010 AND 2009
(in millions, except per share amounts, and unaudited)

	Six Months Ended						Three Months Ended
	June 30,						June 30,
	2010			2009			2010			2009
Operating revenues
Service and other revenues	$	2,498.3		$	1,902.5		$	1,280.6		$	992.2
Digital handset and accessory revenues		136.8			117.7			71.4			66.7
		2,635.1			2,020.2			1,352.0			1,058.9
Operating expenses
Cost of service (exclusive of depreciation and amortization included below)		695.9			545.2			346.4			289.3
Cost of digital handset and accessory sales		354.9			311.0			182.1			165.7
Selling, general and administrative		894.7			652.0			475.3			337.0
Depreciation		247.8			182.9			127.1			96.5
Amortization		16.1			13.7			8.1			7.2
		2,209.4			1,704.8			1,139.0			895.7
Operating income		425.7			315.4			213.0			163.2
Other income (expense)
Interest expense		(179.0	)		(86.7	)		(93.3	)		(42.1	)
Interest income		13.9			16.4			8.3			3.8
Foreign currency transaction (losses) gains, net		(1.0	)		56.2			24.1			63.5
Other (expense) income, net		(7.9	)		5.6			(3.5	)		7.2
		(174.0	)		(8.5	)		(64.4	)		32.4
Income before income tax provision		251.7			306.9			148.6			195.6
Income tax provision		(127.7	)		(102.0	)		(73.1	)		(61.3	)
Net income	$	124.0		$	204.9		$	75.5		$	134.3
Net income per common share, basic	$	0.74		$	1.24		$	0.45		$	0.81
Net income per common share, diluted	$	0.73		$	1.22		$	0.44		$	0.79
Weighted average number of common shares outstanding, basic		167.3			165.9			167.9			166.0
Weighted average number of common shares outstanding, diluted		170.8			173.1			171.2			173.3

CONSOLIDATED BALANCE SHEET DATA
(in millions)

	June 30,		December 31,
	2010		2009
	(unaudited)
Cash and cash equivalents	$	1,819.9	$	2,504.1
Short-term investments		552.6		116.3
Accounts receivable, less allowance for doubtful accounts of $36.4 and $35.1		674.6		613.6
Property, plant and equipment, net		2,588.1		2,502.2
Intangible assets, net		378.1		337.2
Total assets		7,718.5		7,554.7
Long-term debt, including current portion		3,545.8		3,580.8
Total liabilities		4,833.1		4,807.9
Stockholders’ equity		2,885.4		2,746.8

NII HOLDINGS, INC. AND SUBSIDIARIES
OPERATING RESULTS AND METRICS
FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2010 AND 2009
(UNAUDITED)

NII Holdings, Inc.
(subscribers in thousands)

	Three Months Ended
	June 30,
	2010			2009
Total digital subscribers (as of June 30)		8,155.6			6,708.0
Net subscriber additions		392.3			242.1
Churn (%)		1.71	%		2.15	%
Average monthly revenue per handset/unit in service (ARPU) (1)	$	47		$	44
Cost per gross add (CPGA) (1)	$	286		$	262

Nextel Mexico
(dollars in millions, except ARPU and CPGA, and subscribers in thousands)

	Six Months Ended				Three Months Ended
	June 30,				June 30,
	2010		2009		2010			2009
Operating revenues
Service and other revenues	$	990.7	$	877.7	$	502.8		$	450.3
Digital handset and accessory revenues		42.9		38.3		21.4			20.7
		1,033.6		916.0		524.2			471.0
Operating expenses
Cost of service (exclusive of depreciation and amortization included below)		161.9		172.1		75.5			88.5
Cost of digital handset and accessory sales		200.9		179.3		100.1			91.0
Selling, general and administrative		281.6		237.7		143.8			118.7
Segment earnings		389.2		326.9		204.8			172.8
Management fee		47.4		15.9		24.0			8.0
Depreciation and amortization		95.4		80.9		48.6			41.9
Operating income	$	246.4	$	230.1	$	132.2		$	122.9
Total digital subscribers (as of June 30)						3,184.8			2,834.9
Net subscriber additions						93.2			18.9
Churn (%)						1.91	%		2.58	%
ARPU (1)					$	47		$	48
CPGA (1)					$	386		$	362

Nextel Brazil
(dollars in millions, except ARPU and CPGA, and subscribers in thousands)

	Six Months Ended				Three Months Ended
	June 30,				June 30,
	2010		2009		2010			2009
Operating revenues
Service and other revenues	$	1,116.5	$	657.5	$	578.5		$	360.2
Digital handset and accessory revenues		57.9		49.0		32.1			30.2
		1,174.4		706.5		610.6			390.4
Operating expenses
Cost of service (exclusive of depreciation and amortization included below)		390.7		239.8		200.2			134.7
Cost of digital handset and accessory sales		86.1		73.7		48.2			44.4
Selling, general and administrative		347.2		209.5		188.5			115.8
Segment earnings		350.4		183.5		173.7			95.5
Management fee		16.6		—		8.3			—
Depreciation and amortization		116.5		74.7		60.1			41.3
Operating income	$	217.3	$	108.8	$	105.3		$	54.2
Total digital subscribers (as of June 30)						2,867.2			2,106.1
Net subscriber additions						203.9			167.2
Churn (%)						1.38	%		1.38	%
ARPU (1)					$	60		$	51
CPGA (1)					$	257		$	222

Nextel Argentina
(dollars in millions, except ARPU and CPGA, and subscribers in thousands)

	Six Months Ended				Three Months Ended
	June 30,				June 30,
	2010		2009		2010			2009
Operating revenues
Service and other revenues	$	247.7	$	243.6	$	125.8		$	119.4
Digital handset and accessory revenues		21.2		17.3		10.3			9.3
		268.9		260.9		136.1			128.7
Operating expenses
Cost of service (exclusive of depreciation and amortization included below)		87.6		87.8		43.3			43.0
Cost of digital handset and accessory sales		36.2		29.0		17.7			15.5
Selling, general and administrative		76.5		60.8		43.1			28.7
Segment earnings		68.6		83.3		32.0			41.5
Management fee		7.5		—		3.7			—
Depreciation and amortization		19.5		19.5		9.8			9.7
Operating income	$	41.6	$	63.8	$	18.5		$	31.8
Total digital subscribers (as of June 30)						1,083.2			985.7
Net subscriber additions						28.9			7.4
Churn (%)						1.70	%		2.45	%
ARPU (1)					$	34		$	35
CPGA (1)					$	217		$	189

Nextel Peru
(dollars in millions, except ARPU and CPGA, and subscribers in thousands)

	Six Months Ended					Three Months Ended
	June 30,					June 30,
	2010			2009		2010			2009
Operating revenues
Service and other revenues	$	134.5		$	118.3	$	68.9		$	59.4
Digital handset and accessory revenues		14.7			13.1		7.4			6.5
		149.2			131.4		76.3			65.9
Operating expenses
Cost of service (exclusive of depreciation and amortization included below)		50.1			42.4		24.4			21.3
Cost of digital handset and accessory sales		29.8			27.3		14.9			13.9
Selling, general and administrative		59.1			46.5		31.0			24.9
Segment earnings		10.2			15.2		6.0			5.8
Management fee		8.3			—		4.2			—
Depreciation and amortization		24.7			14.8		12.7			7.5
Operating (loss) income	$	(22.8	)	$	0.4	$	(10.9	)	$	(1.7	)
Total digital subscribers (as of June 30)							965.9			747.9
Net subscriber additions							60.4			44.0
Churn (%)							2.06	%		2.24	%
ARPU (1)						$	23		$	25
CPGA (1)						$	157		$	151

(1) For information regarding ARPU and CPGA, see “Non-GAAP Reconciliations for the Six and Three Months Ended June, 30, 2010 and 2009” included in this release.

NON-GAAP RECONCILIATIONS
FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2010 AND 2009
(UNAUDITED)

Operating Income Before Depreciation and Amortization

Consolidated operating income before depreciation and amortization, or OIBDA, represents operating income before depreciation and amortization expense. Consolidated OIBDA is not a measurement under accounting principles generally accepted in the United States, may not be similar to consolidated OIBDA measures of other companies and should be considered in addition to, but not as a substitute for, the information contained in our statements of operations. We believe that consolidated OIBDA provides useful information to investors because it is an indicator of operating performance, especially in a capital intensive industry such as ours, since it excludes items that are not directly attributable to ongoing business operations. Our consolidated OIBDA calculations are commonly used as some of the bases for investors, analysts and credit rating agencies to evaluate and compare the periodic and future operating performance and value of companies within the wireless telecommunications industry. Consolidated OIBDA can be reconciled to our consolidated statements of operations as follows (in millions):

NII Holdings, Inc.

	Three Months Ended June 30,
	2010		2009		2007
Consolidated operating income	$	213.0	$	163.2		135.1
Consolidated depreciation		127.1		96.5		71.1
Consolidated amortization		8.1		7.2		1.7
Consolidated operating income before depreciation and amortization	$	348.2	$	266.9	$	207.9

	Original			Revised
	Guidance			Guidance
	Estimate*			Estimate*
	Year Ended			Year Ended
	December 31,			December 31,
	2010		2010
Consolidated operating income	$	703.0 – 803.0		$	803.0 – 878.0
Consolidated depreciation		514.0			514.0
Consolidated amortization		33.0			33.0
Consolidated operating income before depreciation and amortization	$	1,250.0 – 1,350.0		$	1,350.0 – 1,425.0

* The Company’s guidance estimate for OIBDA for the year ended December 31, 2010 includes the impact of approximately $75 million of non-cash equity compensation expense. This estimate is predicated on a number of assumptions, including the assumption that foreign currency exchange rates and general economic conditions in its markets will remain relatively stable during the year. The information regarding the Company’s outlook and objectives for 2010, including its guidance estimate for OIBDA for the year ended December 31, 2010, is forward looking and is based upon management’s current beliefs, as well as a number of assumptions concerning future events, and as such, should be taken in the context of the risks and uncertainties identified in the “Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995 included above and of the risks and uncertainties outlined in the SEC filings of NII Holdings, Inc., including the Company’s Annual Report on Form 10-K for the year ended December 31, 2009 and the Company’s other filings with the SEC.

Average Monthly Revenue Per Handset/Unit in Service (ARPU)

Average monthly revenue per handset/unit in service, or ARPU, is an industry term that measures service revenues, which we refer to as subscriber revenues, per period from our customers divided by the weighted average number of handsets in commercial service during that period. ARPU is not a measurement under accounting principles generally accepted in the United States, may not be similar to ARPU measures of other companies and should be considered in addition, but not as a substitute for, the information contained in our statements of operations. We believe that ARPU provides useful information concerning the appeal of our rate plans and service offerings and our performance in attracting and retaining high value customers. Other revenue includes revenues for such services as roaming, handset maintenance, cancellation fees, analog and other. ARPU can be calculated and reconciled to our consolidated statement of operations as follows (in millions, except ARPU):

NII Holdings, Inc.

	Three Months Ended
	June 30,
	2010			2009
Consolidated service and other revenues	$	1,280.6		$	992.2
Less: consolidated analog revenues		(0.4	)		(0.8	)
Less: consolidated other revenues		(160.3	)		(116.4	)
Total consolidated subscriber revenues	$	1,119.9		$	875.0
ARPU calculated with subscriber revenues	$	47		$	44
ARPU calculated with service and other revenues	$	54		$	50

Nextel Mexico

	Three Months Ended
	June 30,
	2010			2009
Service and other revenues	$	502.8		$	450.3
Less: analog revenues		(0.4	)		(0.4	)
Less: other revenues		(58.3	)		(43.1	)
Total subscriber revenues	$	444.1		$	406.8
ARPU calculated with subscriber revenues	$	47		$	48
ARPU calculated with service and other revenues	$	53		$	53

Nextel Brazil

	Three Months Ended
	June 30,
	2010			2009
Service and other revenues	$	578.5		$	360.2
Less: analog revenues		—			(0.4	)
Less: other revenues		(77.6	)		(51.0	)
Total subscriber revenues	$	500.9		$	308.8
ARPU calculated with subscriber revenues	$	60		$	51
ARPU calculated with service and other revenues	$	70		$	59

Nextel Argentina

	Three Months Ended
	June 30,
	2010			2009
Service and other revenues	$	125.8		$	119.4
Less: other revenues		(18.1	)		(17.2	)
Total subscriber revenues	$	107.7		$	102.2
ARPU calculated with subscriber revenues	$	34		$	35
ARPU calculated with service and other revenues	$	39		$	41

Nextel Peru

	Three Months Ended
	June 30,
	2010			2009
Service and other revenues	$	68.9		$	59.4
Less: other revenues		(5.6	)		(4.9	)
Total subscriber revenues	$	63.3		$	54.5
ARPU calculated with subscriber revenues	$	23		$	25
ARPU calculated with service and other revenues	$	25		$	27

Cost per Gross Add (CPGA)

Cost per gross add, or CPGA, is an industry term that is calculated by dividing our selling, marketing and handset and accessory subsidy costs, excluding costs unrelated to initial customer acquisition, by our new subscribers during the period, or gross adds. CPGA is not a measurement under accounting principles generally accepted in the United States, may not be similar to CPGA measures of other companies and should be considered in addition, but not as a substitute for, the information contained in our statements of operations. We believe CPGA is a measure of the relative cost of customer acquisition. CPGA can be calculated and reconciled to our consolidated statements of operations as follows (in millions, except CPGA):

NII Holdings, Inc.

	Three Months Ended
	June 30,
	2010			2009
Consolidated digital handset and accessory revenues	$	71.4		$	66.7
Less: consolidated uninsured replacement revenues		(4.2	)		(3.8	)
Consolidated digital handset and accessory revenues, net		67.2			62.9
Less: consolidated cost of handset and accessory sales		182.1			165.7
Consolidated handset subsidy costs		114.9			102.8
Consolidated selling and marketing		165.2			119.2
Costs per statement of operations		280.1			222.0
Less: consolidated costs unrelated to initial customer acquisition		(51.4	)		(46.3	)
Customer acquisition costs	$	228.7		$	175.7
Cost per Gross Add	$	286		$	262

Nextel Mexico

	Three Months Ended
	June 30,
	2010			2009
Digital handset and accessory revenues	$	21.4		$	20.7
Less: uninsured replacement revenues		(2.1	)		(2.1	)
Digital handset and accessory revenues, net		19.3			18.6
Less: cost of handset and accessory sales		100.1			91.0
Handset subsidy costs		80.8			72.4
Selling and marketing		68.0			52.4
Costs per statement of operations		148.8			124.8
Less: costs unrelated to initial customer acquisition		(43.5	)		(38.9	)
Customer acquisition costs	$	105.3		$	85.9
Cost per Gross Add	$	386		$	362

Nextel Brazil

	Three Months Ended
	June 30,
	2010			2009
Digital handset and accessory revenues	$	32.1		$	30.2
Less: uninsured replacement revenues		(2.1	)		(1.6	)
Digital handset and accessory revenues, net		30.0			28.6
Less: cost of handset and accessory sales		48.2			44.4
Handset subsidy costs		18.2			15.8
Selling and marketing		68.4			44.7
Costs per statement of operations		86.6			60.5
Less: costs unrelated to initial customer acquisition		(4.9	)		(4.9	)
Customer acquisition costs	$	81.7		$	55.6
Cost per Gross Add	$	257		$	222

Nextel Argentina

	Three Months Ended
	June 30,
	2010			2009
Digital handset and accessory revenues, net	$	10.3		$	9.3
Less: cost of handset and accessory sales		17.7			15.5
Handset subsidy costs		7.4			6.2
Selling and marketing		12.7			10.1
Costs per statement of operations		20.1			16.3
Less: costs unrelated to initial customer acquisition		(1.9	)		(1.3	)
Customer acquisition costs	$	18.2		$	15.0
Cost per Gross Add	$	217		$	189

Nextel Peru

	Three Months Ended
	June 30,
	2010			2009
Digital handset and accessory revenues, net	$	7.4		$	6.5
Less: cost of handset and accessory sales		14.9			13.9
Handset subsidy costs		7.5			7.4
Selling and marketing		12.1			7.7
Costs per statement of operations		19.6			15.1
Less: costs unrelated to initial customer acquisition		(1.0	)		(1.1	)
Customer acquisition costs	$	18.6		$	14.0
Cost per Gross Add	$	157		$	151

Net Debt

Net debt represents total long-term debt less cash, cash equivalents, short-term and long-term investments. Net debt to consolidated operating income before depreciation and amortization represents net debt divided by consolidated operating income before depreciation and amortization. Prior to 2008, we calculated net debt as total long-term debt less cash and cash equivalents. In 2008, we added short-term investments to the items subtracted from long-term debt to calculate net debt because we concluded that our short-term investments were similar to cash and cash equivalents in terms of liquidity and should be used similarly in providing the assessment of our overall leverage in the net debt calculation. In the second quarter of 2010, we extended the permissible investment maturity dates for cash investments, which resulted in the classification of some of our cash investments as long term investments. As a result, we now include the cash in long-term investments to the items subtracted from long-term debt to calculate net debt. Net debt is not a measurement under accounting principles generally accepted in the United States, may not be similar to net debt measures of other companies and should be considered in addition to, but not as a substitute for, the information contained in our balance sheets. We believe that net debt and net debt to consolidated operating income before depreciation and amortization provide useful information concerning our liquidity and leverage. Net debt as of June 30, 2010 can be calculated as follows (in millions):

NII Holdings, Inc.

Total long-term debt	$	2,819.9
Add: reduction to long-term debt pursuant to implementation of FSP APB 14-1		75.5
Add: debt discounts		21.7
Add: principal amount of 2.75% convertible notes treated as current portion of long-term debt		318.6
Less: cash and cash equivalents		(1,819.9	)
Less: short-term investments		(552.6	)
Less: long-term investments		(100.0	)
Net debt	$	763.2