Leap Reports Results for First Quarter of 2001

Cricket Customer Base Grows to Just Over 339,000;

Leap to Unveil New Data Brand on May 10, 2001



Apr 19, 2001, 01:00 ET from Leap Wireless International, Inc.

    SAN DIEGO, April 19 /PRNewswire/ -- Leap Wireless International, Inc.
 (Nasdaq:   LWIN), an innovator of wireless communications services, today
 reported results for the first quarter of fiscal year 2001.  As of March 31,
 2001, customers of the company's Cricket service grew to just over 339,000,
 compared to the more than 190,000 customers reported as of Dec. 31, 2000.
 Leap pioneered the Cricket flat-rate, all-you-can-talk local wireless service
 as an affordable alternative to traditional landline service.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010306/LATU057LOGO )
     "We believe Leap's innovative approach to wireless voice and data services
 continues to set us apart from the rest of the wireless industry," said Harvey
 P. White, Leap's chairman and CEO.  "Compared to traditional wireless voice
 carriers, we believe we add customers faster, keep operating costs lower, and
 reach EBITDA positive at the market level sooner.  Our target customer is the
 mass consumer, which is broader than most traditional wireless carriers.  Even
 our customers are different.  Nearly half of our customers are new to wireless
 when they join our service, and many of them are choosing Cricket service over
 a first or second wired phone line.  We remain pleased with our performance
 and expect to continue to replicate our rapid market penetration while
 maintaining tight cost controls on our operations in both our existing and new
 markets."
     "We think our results during the first quarter show that customers
 continue to be drawn to Cricket service because it is predictable, simple and
 value-priced," said Susan G. Swenson, Leap's president and chief operating
 officer.  "Once our first-time wireless customers experience the freedom of
 mobility, it becomes an important part of their daily lives -- and for many,
 their primary phone line.  Even in the current economic climate, we think we
 are well positioned to reach our goal of approximately 450,000 customers by
 the end of the second quarter and approximately one million customers by
 year's end."
     Leap also announced that, on May 10, 2001, it will announce the details of
 its first new data service.  The announcement will include expected timing,
 pricing, and the brand name of this initial product within Leap's planned
 family of innovative data services.
     "We are working to expand Leap's family of innovations to provide
 customers with entertainment, personalized information and more," said Doug
 Hutcheson, Leap's senior vice president of wireless data development.  "We
 think our simple, customer-focused approach will be differentiated in the
 marketplace and we expect to bring a new group of customers into the world of
 wireless data."
 
     Cricket Operational Highlights
     Operational highlights from the first quarter of 2001 included:
     --  Leap launched an additional four markets -- Pueblo, Colo.; Wichita,
         Kan.; and Albuquerque and Santa Fe, N.M. -- bringing the total
         potential customers covered by Cricket service in markets across the
         United States to approximately 9.2 million (1998 POPs).
     --  Average revenue per user per month (ARPU) across all of Leap's
         operational markets was approximately $35.
     --  Overall cost per gross customer addition (CPGA) was less than $230.
 
     Leap also reported the following results for its one-year or older
 markets, Chattanooga and Nashville, Tenn.:
     --  Penetration of covered POPs in each of these markets was within Leap's
         guidance of six to seven percent at the end of a market's first year
         of operation and nine to 10 percent at the end of its second year.
     --  In March 2001, combined churn in both markets was 3.4%, reflecting
         both the maturation of these markets and improvements resulting from
         Leap's focus on customer retention.
     --  Earnings before interest, taxes, depreciation, amortization, and
         marketing (EBITDAM) margin for both markets combined exceeded the
         Company's guidance for one-year old markets of the low to mid-20
         percent range.
     --  Earnings before interest, taxes, depreciation, and amortization
         (EBITDA) margin in Cricket's Chattanooga market was positive for the
         quarter and, in Nashville, was positive in March, which was the
         market's 14th month of operation.
     --  Average minutes of use for the aggregate of both markets was
         approximately 1100 minutes of use per month, up slightly from previous
         usage trends.
 
     "The performance of Leap's long-term markets speaks to our dedication to
 be the lowest cost provider of wireless service in the United States,"
 continued Swenson.  "I am personally very pleased to see the progress the Leap
 team has made.  Our success to date in implementing the concepts of Cricket's
 re-engineered cost model is the result of their hard work and commitment to
 our business."
 
     Financial Results
     Key financial performance measures for the first quarter ended March 31,
 2001 are as follows:
     --  Total operating revenues for Leap's U.S. operations for the first
         quarter were $36.8 million, an increase of 158 percent over the
         previous quarter.
     --  Consolidated earnings before interest, taxes, depreciation and
         amortization (EBITDA) was negative $48.1 million, down from the
         negative $60.5 million at the end of the prior quarter.
     --  Leap's consolidated net loss for the quarter was $114.4 million or
         $3.88 per share, compared to a net loss of $103.5 million or $3.82 per
         share in the prior quarter.  Of the $3.88 net loss per share reported
         in the first quarter, $0.89 was the result of losses for PEGASO
         recognized under the equity method of accounting.
     --  Leap's total cash and cash equivalents, investments, and deposits on
         pending wireless license acquisitions as of March 31, 2001 were
         approximately $655 million.
     --  Leap's property and equipment, net of depreciation, rose to
         approximately $508 million in the first quarter, an increase of
         approximately 18 percent from that reported at December 31, 2000.
 
     Wireless Data Highlights
     --  Acquisitions -- In March 2001, Leap announced two acquisitions to
         support its planned fresh approach to offering the first of several
         wireless data services.  Leap acquired the proprietary technology and
         intellectual property of Spotcast Communications, and agreed to
         acquire Backwire.com, a publisher of customized e-mail newsletters and
         developer of one-to-one content customization technologies, which is
         expected to close in April 2001.  Leap plans to combine the
         technologies from recent data acquisitions with internally developed
         technology to build a stable of intellectual property and proprietary
         technology protected by patent positions.
     --  Services -- In March 2001, Leap announced initial details about its
         first planned wireless data service, which it expects to roll out
         commercially in selected markets in the second quarter of 2001 and to
         phase in alongside Cricket service in other operational markets over
         time.  Leap is designing this new "mobile media" service to deliver
         quick voice clips directly to the customer's wireless handset.  The
         mix of voice clips is expected to be weighted toward fun, informative
         and personalized content, and to be supported by value-focused
         promotions and relevant advertising.  Leap plans to target different
         messages to customers depending on their location and time of day, as
         well as their own personal profile of interests and preferences.  Leap
         expects to offer the new service initially to its Cricket customers as
         an add-on feature.  The company plans to market this new mobile media
         service under a new brand name, which, like Cricket, will also be
         tagged "Another Leap Innovation."
 
     Other Highlights
     --  Spectrum Acquisitions -- At the end of the quarter, Leap owned or had
         rights to acquire wireless operating licenses covering 72.6 million
         potential customers (1998 POPs) in 36 states, assuming transfer by the
         Federal Communications Commission (FCC).  This represents
         approximately one quarter of the U.S. population and was up
         approximately 50 percent from 48.3 million potential customers (1998
         POPs) at the end of 2000.  The company was the high bidder on 22
         licenses covering approximately 22.4 million potential customers (1998
         POPs) in the broadband PCS Auction #35 concluded by the FCC in January
         2001.  Leap's high bids totaled approximately $350 million, or $15.62
         per POP, which was the lowest average price per POP among the ten most
         active bidders in the auction.
     --  International Operations -- PEGASO, the Mexican wireless company that
         Leap co-founded, continued to expand.  PEGASO grew its customer base
         to approximately 624,000 at the end of the quarter, up approximately
         88,000 from the 536,000 customers reported on Dec. 31, 2000.  During
         the first quarter, PEGASO also launched service in Mexicali and
         Saltillo, ending the quarter with service in 10 cities in Mexico.
 
     Business Outlook
     The following forward-looking statements are based on management's current
 expectations for future results.  These expectations are based on current
 information, which we have assessed but which by its nature is dynamic and
 subject to rapid and even abrupt changes.  The following forward-looking
 statements speak only of management's views as of the date of this release and
 we do not undertake to update this information from this date.  Our actual
 results could differ materially from those stated or implied by such
 forward-looking statements due to risks and uncertainties associated with our
 business.  Factors that could cause actual results to differ include those
 described at the end of this release.
 
     Leap currently expects its customer base in the Unites States to reach
 approximately 450,000 customers at the end of the second quarter of fiscal
 year 2001 and expects to achieve the following results in its domestic
 operations at the end of fiscal year 2001:
     --  Total customers are expected to grow to approximately one million.
     --  Leap's Cricket service is expected to be generating approximately
         $400 million in service revenues on a forward-looking annualized
         basis.
     --  CPGA in operational markets is expected to be approximately $230.
     --  Cumulative capital expenditures are expected to be approximately
         $1.25 billion, reflecting the significant investment Leap expects to
         make in the build-out of its markets to support their anticipated
         future growth.
 
     Leap's current expectations relative to the performance of a typical
 Cricket market on a "same-market-sales" basis are as follows:
 
     --  Penetration -- At the end of the first year of operation, Leap expects
         a typical Cricket market to have reached approximately six to seven
         percent penetration of covered POPs.  This penetration is expected to
         increase to nine to 10 percent at the end of the second year of
         operation and thereafter increase at a rate of approximately one
         percent a year with long term penetration being in the mid to high
         teens.
     --  Average Revenue Per User -- ARPU, excluding any data service related
         revenue, is expected to be in the mid-$30 range throughout a typical
         market's first and second year of operation.
     --  Minutes of Use -- Average MOU per user is expected to be approximately
         900 to 1100 minutes per month.
     --  Churn -- Churn in one-year old markets is expected to be between four
         to five percent and between three to four percent in two-year old
         markets.  Churn in markets in their third year of operation is
         expected to be in line with the industry average.
     --  Earnings Before Interest, Taxes, Depreciation, Amortization, and
         Marketing -- At the end of the first year of operation, Leap expects
         the EBITDAM margin of a typical Cricket market to be in the low to
         mid-20 percent range based on service revenue.  This margin is
         expected to increase to approximately 40 percent at the end of the
         second year of operation and to the mid-50 percent range long term.
     --  Earnings Before Interest, Taxes, Depreciation, and Amortization - A
         typical Cricket market is expected to be at EBITDA break-even based on
         service revenue after 12 to 15 months of operation.  EBITDA margin,
         based on service revenue, is expected to be approximately 20 percent
         at the end of the market's second year of operation and in the mid-40
         percent range long term.
 
     About Leap
     Leap, headquartered in San Diego, Calif., is a customer-focused company
 providing innovative communications services for the mass market.  Leap
 pioneered the Cricket Comfortable Wireless service that lets customers make
 all their local calls from within their local service area and receive calls
 from anywhere for one low, flat rate.  Leap currently has several new services
 in development, including data services designed to further transform wireless
 communications for consumers.  For more information, please visit
 www.leapwireless.com.
 
     Except for the historical information contained herein, this news release
 contains "forward-looking statements," including statements reflecting
 management's current forecast of certain aspects of Leap's future.
 Forward-looking statements, which are based upon certain assumptions and
 describe future plans, strategies and expectations of the Company, are
 generally identifiable by the use of the words "believe," "expect," "intend,"
 "plan," "anticipate," "estimate," "project" or similar expressions.  These
 statements are based on current information, which we have assessed but which
 by its nature is dynamic and subject to rapid and even abrupt changes.  The
 forward-looking statements in this news release speak only of management's
 views as of the date of this release and we do not undertake any obligation to
 update this information from this date.  Our actual results could differ
 materially from those stated or implied by such forward-looking statements due
 to risks and uncertainties associated with our business.  Factors that could
 cause actual results to differ include, but are not limited to:  changes in
 the economic conditions of the various markets our subsidiaries serve which
 could adversely affect the market for wireless services; our ability to access
 capital markets; a failure to meet the operational, financial or other
 covenants of our credit facilities; our ability to rollout networks in
 accordance with our plans, including receiving equipment and backhaul and
 interconnection facilities on schedule from third parties; failure of network
 systems to perform according to expectations; the effect of competition; the
 acceptance of our product offering by our target customers; our ability to
 retain customers; our ability to maintain our cost, market penetration and
 pricing structure in the face of competition; uncertainties relating to
 negotiating and executing definitive agreements and the ability to close
 pending transactions described in this release; technological challenges in
 developing wireless data services and customer acceptance of such services if
 developed; our ability to integrate the businesses and technologies we
 acquire; rulings by courts or the FCC adversely affecting our rights to own
 and/or operate certain wireless licenses; and other factors detailed in the
 section entitled "Risk Factors" included in our Annual Report on Form 10-K for
 the fiscal year ended December 31, 2000 and in our other SEC filings.  The
 forward-looking statements should be considered in the context of these risk
 factors. Investors and prospective investors are cautioned not to place undue
 reliance on such forward-looking statements.  We undertake no obligation to
 publicly update or revise any forward-looking statements, whether as a result
 of new information, future events or otherwise.  Leap and the logo design are
 trademarks of Leap Wireless International, Inc.  Cricket is a registered
 trademark and Comfortable Wireless and the Around-Town Phone are service marks
 of Cricket Communications, Inc.
 
     Conference Call Note
     Leap will hold a conference call to discuss these results at 4:30 p.m. ET,
 Thursday, April 19, 2001.  A live broadcast of the conference call will be
 available online at the following Internet links:
 
     www.leapwireless.com or www.streetevents.com.
 
     To listen to the call, please go to the Web site at least 15 minutes prior
 to the start time to register, download and install any necessary audio
 software.  A replay of the conference call will be available shortly after the
 call through close of business May 19, 2001.  The conference call will also be
 rebroadcast telephonically until April 26th, beginning shortly after its
 completion.  You can access the rebroadcast by dialing 1-800-633-8284 and
 entering the reservation number 18424483 followed by the # key.  International
 callers should dial 858-812-6440 and enter reservation number 18424483
 followed by the # key.  For persons who do not have access to the Internet,
 please contact Leap's Investor Relations department at 858-882-6206 for the
 telephone access number.
 
 
                       LEAP WIRELESS INTERNATIONAL, INC.
 
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (UNAUDITED)
                                 (In thousands)
 
                                                     March 31,    December 31,
                                                       2001           2000
     Assets
     Cash and cash equivalents                       $342,589       $338,878
     Restricted cash equivalents                       13,678         13,575
     Short-term investments                           216,073        199,106
     Inventories                                       12,574          9,032
     Notes receivable, net                             79,276        138,907
     Other current assets                               8,066         12,746
         Total current assets                         672,256        712,244
     Property and equipment, net                      507,991        430,193
     Investment in unconsolidated wireless
      operating company                                 8,191         34,691
     Wireless licenses, net                           273,436        265,635
     Goodwill and other intangible assets, net         33,371         30,297
     Restricted investments                            52,735         51,896
     Deposits and other assets                        248,965        122,451
         Total assets                              $1,796,945     $1,647,407
 
     Liabilities and Stockholders' Equity
     Accounts payable and accrued liabilities         $40,331        $58,735
     Other current liabilities                         60,023         65,690
         Total current liabilities                    100,354        124,425
     Long-term debt                                 1,130,318        897,878
     Other long-term liabilities                       40,014         41,846
         Total liabilities                          1,270,686      1,064,149
     Stockholders' equity:
       Preferred stock                                     --             --
       Common stock                                         3              3
       Additional paid-in capital                     948,990        893,401
       Unearned stock-based compensation               (8,256)       (10,019)
       Accumulated deficit                           (417,283)      (302,898)
       Accumulated other comprehensive income           2,805          2,771
         Total stockholders' equity                   526,259        583,258
         Total liabilities and
          stockholders' equity                     $1,796,945     $1,647,407
 
 
                       LEAP WIRELESS INTERNATIONAL, INC.
 
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)
                     (In thousands, except per share data)
 
                                                Three Months Ended
                                                      March 31,
                                                                  2000 Pro
                                          2001         2000       Forma(1)
     Revenues:
       Service revenues                  $25,655       $9,418      $2,762
       Equipment revenues                 11,098          573       1,437
         Total revenues                   36,753        9,991       4,199
     Operating expenses:
       Cost of service                   (12,226)      (2,783)     (1,312)
       Cost of equipment                 (30,938)     (13,248)     (4,459)
       Selling and marketing             (17,015)      (6,676)     (1,476)
       General and administrative
        expenses                         (24,686)     (15,427)    (11,791)
       Depreciation and amortization     (14,787)      (5,242)     (6,029)
         Total operating expenses        (99,652)     (43,376)    (25,067)
       Operating loss                    (62,899)     (33,385)    (20,868)
     Equity in net loss of
      investments in and loan
      receivable from unconsolidated
      wireless operating companies       (26,182)     (29,583)    (19,144)
     Interest income                      10,899        4,691       4,687
     Interest expense                    (37,611)     (16,160)    (13,890)
     Foreign currency transaction
      gains (losses), net                 (1,235)       1,399          --
     Other income, net                     3,576          635         665
     Loss before income taxes
      and extraordinary item            (113,452)     (72,403)    (48,550)
     Income taxes                           (933)          --          --
     Loss before extraordinary item     (114,385)     (72,403)    (48,550)
 
     Extraordinary loss on early
      extinguishment of debt                  --       (4,422)     (4,422)
         Net loss                      $(114,385)    $(76,825)   $(52,972)
     Basic and diluted net loss
      per common share:
       Loss before extraordinary item     $(3.88)      $(3.23)     $(2.17)
       Extraordinary loss                     --        (0.20)      (0.20)
         Net loss                         $(3.88)      $(3.43)     $(2.37)
     Shares used in per share
      calculations:
       Basic and diluted                  29,462       22,397      22,397
 
     (1) The pro forma results for the three months ended March 31, 2000 assume
         that the Company had purchased substantially all the assets of Chase
         Telecommunications Holdings, Inc. on January 1, 2000 and had sold its
         interest in Smartcom S.A. on December 31, 1999.
 
 
                       LEAP WIRELESS INTERNATIONAL, INC.
 
                             SELECTED SEGMENT DATA
                                  (UNAUDITED)
                                 (In thousands)
 
                                                        As of and for the
                                                        Three Months Ended
                                                            March 31,
                                                       2001          2000
     United States:
     Revenues                                         $36,753         $4,199
     EBITDA                                           (41,017)        (8,837)
     Operating loss                                   (55,358)       (14,506)
     Capital expenditures                             (86,037)       (35,886)
     Purchase of wireless licenses                     (6,714)       (73,154)
     Total assets                                   1,173,583        213,635
 
     Mexico(1):
     Revenues                                          38,295          4,652
     EBITDA                                           (87,871)       (48,482)
     Operating loss                                  (100,660)       (53,509)
     Capital expenditures                             (99,133)       (66,067)
     Total assets                                     806,215        597,566
 
     (1) The results of the Mexico segment are for the quarters ended December
         31, 2000 and 1999, a three month reporting lag.
 
 

SOURCE Leap Wireless International, Inc.
    SAN DIEGO, April 19 /PRNewswire/ -- Leap Wireless International, Inc.
 (Nasdaq:   LWIN), an innovator of wireless communications services, today
 reported results for the first quarter of fiscal year 2001.  As of March 31,
 2001, customers of the company's Cricket service grew to just over 339,000,
 compared to the more than 190,000 customers reported as of Dec. 31, 2000.
 Leap pioneered the Cricket flat-rate, all-you-can-talk local wireless service
 as an affordable alternative to traditional landline service.
     (Photo:  http://www.newscom.com/cgi-bin/prnh/20010306/LATU057LOGO )
     "We believe Leap's innovative approach to wireless voice and data services
 continues to set us apart from the rest of the wireless industry," said Harvey
 P. White, Leap's chairman and CEO.  "Compared to traditional wireless voice
 carriers, we believe we add customers faster, keep operating costs lower, and
 reach EBITDA positive at the market level sooner.  Our target customer is the
 mass consumer, which is broader than most traditional wireless carriers.  Even
 our customers are different.  Nearly half of our customers are new to wireless
 when they join our service, and many of them are choosing Cricket service over
 a first or second wired phone line.  We remain pleased with our performance
 and expect to continue to replicate our rapid market penetration while
 maintaining tight cost controls on our operations in both our existing and new
 markets."
     "We think our results during the first quarter show that customers
 continue to be drawn to Cricket service because it is predictable, simple and
 value-priced," said Susan G. Swenson, Leap's president and chief operating
 officer.  "Once our first-time wireless customers experience the freedom of
 mobility, it becomes an important part of their daily lives -- and for many,
 their primary phone line.  Even in the current economic climate, we think we
 are well positioned to reach our goal of approximately 450,000 customers by
 the end of the second quarter and approximately one million customers by
 year's end."
     Leap also announced that, on May 10, 2001, it will announce the details of
 its first new data service.  The announcement will include expected timing,
 pricing, and the brand name of this initial product within Leap's planned
 family of innovative data services.
     "We are working to expand Leap's family of innovations to provide
 customers with entertainment, personalized information and more," said Doug
 Hutcheson, Leap's senior vice president of wireless data development.  "We
 think our simple, customer-focused approach will be differentiated in the
 marketplace and we expect to bring a new group of customers into the world of
 wireless data."
 
     Cricket Operational Highlights
     Operational highlights from the first quarter of 2001 included:
     --  Leap launched an additional four markets -- Pueblo, Colo.; Wichita,
         Kan.; and Albuquerque and Santa Fe, N.M. -- bringing the total
         potential customers covered by Cricket service in markets across the
         United States to approximately 9.2 million (1998 POPs).
     --  Average revenue per user per month (ARPU) across all of Leap's
         operational markets was approximately $35.
     --  Overall cost per gross customer addition (CPGA) was less than $230.
 
     Leap also reported the following results for its one-year or older
 markets, Chattanooga and Nashville, Tenn.:
     --  Penetration of covered POPs in each of these markets was within Leap's
         guidance of six to seven percent at the end of a market's first year
         of operation and nine to 10 percent at the end of its second year.
     --  In March 2001, combined churn in both markets was 3.4%, reflecting
         both the maturation of these markets and improvements resulting from
         Leap's focus on customer retention.
     --  Earnings before interest, taxes, depreciation, amortization, and
         marketing (EBITDAM) margin for both markets combined exceeded the
         Company's guidance for one-year old markets of the low to mid-20
         percent range.
     --  Earnings before interest, taxes, depreciation, and amortization
         (EBITDA) margin in Cricket's Chattanooga market was positive for the
         quarter and, in Nashville, was positive in March, which was the
         market's 14th month of operation.
     --  Average minutes of use for the aggregate of both markets was
         approximately 1100 minutes of use per month, up slightly from previous
         usage trends.
 
     "The performance of Leap's long-term markets speaks to our dedication to
 be the lowest cost provider of wireless service in the United States,"
 continued Swenson.  "I am personally very pleased to see the progress the Leap
 team has made.  Our success to date in implementing the concepts of Cricket's
 re-engineered cost model is the result of their hard work and commitment to
 our business."
 
     Financial Results
     Key financial performance measures for the first quarter ended March 31,
 2001 are as follows:
     --  Total operating revenues for Leap's U.S. operations for the first
         quarter were $36.8 million, an increase of 158 percent over the
         previous quarter.
     --  Consolidated earnings before interest, taxes, depreciation and
         amortization (EBITDA) was negative $48.1 million, down from the
         negative $60.5 million at the end of the prior quarter.
     --  Leap's consolidated net loss for the quarter was $114.4 million or
         $3.88 per share, compared to a net loss of $103.5 million or $3.82 per
         share in the prior quarter.  Of the $3.88 net loss per share reported
         in the first quarter, $0.89 was the result of losses for PEGASO
         recognized under the equity method of accounting.
     --  Leap's total cash and cash equivalents, investments, and deposits on
         pending wireless license acquisitions as of March 31, 2001 were
         approximately $655 million.
     --  Leap's property and equipment, net of depreciation, rose to
         approximately $508 million in the first quarter, an increase of
         approximately 18 percent from that reported at December 31, 2000.
 
     Wireless Data Highlights
     --  Acquisitions -- In March 2001, Leap announced two acquisitions to
         support its planned fresh approach to offering the first of several
         wireless data services.  Leap acquired the proprietary technology and
         intellectual property of Spotcast Communications, and agreed to
         acquire Backwire.com, a publisher of customized e-mail newsletters and
         developer of one-to-one content customization technologies, which is
         expected to close in April 2001.  Leap plans to combine the
         technologies from recent data acquisitions with internally developed
         technology to build a stable of intellectual property and proprietary
         technology protected by patent positions.
     --  Services -- In March 2001, Leap announced initial details about its
         first planned wireless data service, which it expects to roll out
         commercially in selected markets in the second quarter of 2001 and to
         phase in alongside Cricket service in other operational markets over
         time.  Leap is designing this new "mobile media" service to deliver
         quick voice clips directly to the customer's wireless handset.  The
         mix of voice clips is expected to be weighted toward fun, informative
         and personalized content, and to be supported by value-focused
         promotions and relevant advertising.  Leap plans to target different
         messages to customers depending on their location and time of day, as
         well as their own personal profile of interests and preferences.  Leap
         expects to offer the new service initially to its Cricket customers as
         an add-on feature.  The company plans to market this new mobile media
         service under a new brand name, which, like Cricket, will also be
         tagged "Another Leap Innovation."
 
     Other Highlights
     --  Spectrum Acquisitions -- At the end of the quarter, Leap owned or had
         rights to acquire wireless operating licenses covering 72.6 million
         potential customers (1998 POPs) in 36 states, assuming transfer by the
         Federal Communications Commission (FCC).  This represents
         approximately one quarter of the U.S. population and was up
         approximately 50 percent from 48.3 million potential customers (1998
         POPs) at the end of 2000.  The company was the high bidder on 22
         licenses covering approximately 22.4 million potential customers (1998
         POPs) in the broadband PCS Auction #35 concluded by the FCC in January
         2001.  Leap's high bids totaled approximately $350 million, or $15.62
         per POP, which was the lowest average price per POP among the ten most
         active bidders in the auction.
     --  International Operations -- PEGASO, the Mexican wireless company that
         Leap co-founded, continued to expand.  PEGASO grew its customer base
         to approximately 624,000 at the end of the quarter, up approximately
         88,000 from the 536,000 customers reported on Dec. 31, 2000.  During
         the first quarter, PEGASO also launched service in Mexicali and
         Saltillo, ending the quarter with service in 10 cities in Mexico.
 
     Business Outlook
     The following forward-looking statements are based on management's current
 expectations for future results.  These expectations are based on current
 information, which we have assessed but which by its nature is dynamic and
 subject to rapid and even abrupt changes.  The following forward-looking
 statements speak only of management's views as of the date of this release and
 we do not undertake to update this information from this date.  Our actual
 results could differ materially from those stated or implied by such
 forward-looking statements due to risks and uncertainties associated with our
 business.  Factors that could cause actual results to differ include those
 described at the end of this release.
 
     Leap currently expects its customer base in the Unites States to reach
 approximately 450,000 customers at the end of the second quarter of fiscal
 year 2001 and expects to achieve the following results in its domestic
 operations at the end of fiscal year 2001:
     --  Total customers are expected to grow to approximately one million.
     --  Leap's Cricket service is expected to be generating approximately
         $400 million in service revenues on a forward-looking annualized
         basis.
     --  CPGA in operational markets is expected to be approximately $230.
     --  Cumulative capital expenditures are expected to be approximately
         $1.25 billion, reflecting the significant investment Leap expects to
         make in the build-out of its markets to support their anticipated
         future growth.
 
     Leap's current expectations relative to the performance of a typical
 Cricket market on a "same-market-sales" basis are as follows:
 
     --  Penetration -- At the end of the first year of operation, Leap expects
         a typical Cricket market to have reached approximately six to seven
         percent penetration of covered POPs.  This penetration is expected to
         increase to nine to 10 percent at the end of the second year of
         operation and thereafter increase at a rate of approximately one
         percent a year with long term penetration being in the mid to high
         teens.
     --  Average Revenue Per User -- ARPU, excluding any data service related
         revenue, is expected to be in the mid-$30 range throughout a typical
         market's first and second year of operation.
     --  Minutes of Use -- Average MOU per user is expected to be approximately
         900 to 1100 minutes per month.
     --  Churn -- Churn in one-year old markets is expected to be between four
         to five percent and between three to four percent in two-year old
         markets.  Churn in markets in their third year of operation is
         expected to be in line with the industry average.
     --  Earnings Before Interest, Taxes, Depreciation, Amortization, and
         Marketing -- At the end of the first year of operation, Leap expects
         the EBITDAM margin of a typical Cricket market to be in the low to
         mid-20 percent range based on service revenue.  This margin is
         expected to increase to approximately 40 percent at the end of the
         second year of operation and to the mid-50 percent range long term.
     --  Earnings Before Interest, Taxes, Depreciation, and Amortization - A
         typical Cricket market is expected to be at EBITDA break-even based on
         service revenue after 12 to 15 months of operation.  EBITDA margin,
         based on service revenue, is expected to be approximately 20 percent
         at the end of the market's second year of operation and in the mid-40
         percent range long term.
 
     About Leap
     Leap, headquartered in San Diego, Calif., is a customer-focused company
 providing innovative communications services for the mass market.  Leap
 pioneered the Cricket Comfortable Wireless service that lets customers make
 all their local calls from within their local service area and receive calls
 from anywhere for one low, flat rate.  Leap currently has several new services
 in development, including data services designed to further transform wireless
 communications for consumers.  For more information, please visit
 www.leapwireless.com.
 
     Except for the historical information contained herein, this news release
 contains "forward-looking statements," including statements reflecting
 management's current forecast of certain aspects of Leap's future.
 Forward-looking statements, which are based upon certain assumptions and
 describe future plans, strategies and expectations of the Company, are
 generally identifiable by the use of the words "believe," "expect," "intend,"
 "plan," "anticipate," "estimate," "project" or similar expressions.  These
 statements are based on current information, which we have assessed but which
 by its nature is dynamic and subject to rapid and even abrupt changes.  The
 forward-looking statements in this news release speak only of management's
 views as of the date of this release and we do not undertake any obligation to
 update this information from this date.  Our actual results could differ
 materially from those stated or implied by such forward-looking statements due
 to risks and uncertainties associated with our business.  Factors that could
 cause actual results to differ include, but are not limited to:  changes in
 the economic conditions of the various markets our subsidiaries serve which
 could adversely affect the market for wireless services; our ability to access
 capital markets; a failure to meet the operational, financial or other
 covenants of our credit facilities; our ability to rollout networks in
 accordance with our plans, including receiving equipment and backhaul and
 interconnection facilities on schedule from third parties; failure of network
 systems to perform according to expectations; the effect of competition; the
 acceptance of our product offering by our target customers; our ability to
 retain customers; our ability to maintain our cost, market penetration and
 pricing structure in the face of competition; uncertainties relating to
 negotiating and executing definitive agreements and the ability to close
 pending transactions described in this release; technological challenges in
 developing wireless data services and customer acceptance of such services if
 developed; our ability to integrate the businesses and technologies we
 acquire; rulings by courts or the FCC adversely affecting our rights to own
 and/or operate certain wireless licenses; and other factors detailed in the
 section entitled "Risk Factors" included in our Annual Report on Form 10-K for
 the fiscal year ended December 31, 2000 and in our other SEC filings.  The
 forward-looking statements should be considered in the context of these risk
 factors. Investors and prospective investors are cautioned not to place undue
 reliance on such forward-looking statements.  We undertake no obligation to
 publicly update or revise any forward-looking statements, whether as a result
 of new information, future events or otherwise.  Leap and the logo design are
 trademarks of Leap Wireless International, Inc.  Cricket is a registered
 trademark and Comfortable Wireless and the Around-Town Phone are service marks
 of Cricket Communications, Inc.
 
     Conference Call Note
     Leap will hold a conference call to discuss these results at 4:30 p.m. ET,
 Thursday, April 19, 2001.  A live broadcast of the conference call will be
 available online at the following Internet links:
 
     www.leapwireless.com or www.streetevents.com.
 
     To listen to the call, please go to the Web site at least 15 minutes prior
 to the start time to register, download and install any necessary audio
 software.  A replay of the conference call will be available shortly after the
 call through close of business May 19, 2001.  The conference call will also be
 rebroadcast telephonically until April 26th, beginning shortly after its
 completion.  You can access the rebroadcast by dialing 1-800-633-8284 and
 entering the reservation number 18424483 followed by the # key.  International
 callers should dial 858-812-6440 and enter reservation number 18424483
 followed by the # key.  For persons who do not have access to the Internet,
 please contact Leap's Investor Relations department at 858-882-6206 for the
 telephone access number.
 
 
                       LEAP WIRELESS INTERNATIONAL, INC.
 
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (UNAUDITED)
                                 (In thousands)
 
                                                     March 31,    December 31,
                                                       2001           2000
     Assets
     Cash and cash equivalents                       $342,589       $338,878
     Restricted cash equivalents                       13,678         13,575
     Short-term investments                           216,073        199,106
     Inventories                                       12,574          9,032
     Notes receivable, net                             79,276        138,907
     Other current assets                               8,066         12,746
         Total current assets                         672,256        712,244
     Property and equipment, net                      507,991        430,193
     Investment in unconsolidated wireless
      operating company                                 8,191         34,691
     Wireless licenses, net                           273,436        265,635
     Goodwill and other intangible assets, net         33,371         30,297
     Restricted investments                            52,735         51,896
     Deposits and other assets                        248,965        122,451
         Total assets                              $1,796,945     $1,647,407
 
     Liabilities and Stockholders' Equity
     Accounts payable and accrued liabilities         $40,331        $58,735
     Other current liabilities                         60,023         65,690
         Total current liabilities                    100,354        124,425
     Long-term debt                                 1,130,318        897,878
     Other long-term liabilities                       40,014         41,846
         Total liabilities                          1,270,686      1,064,149
     Stockholders' equity:
       Preferred stock                                     --             --
       Common stock                                         3              3
       Additional paid-in capital                     948,990        893,401
       Unearned stock-based compensation               (8,256)       (10,019)
       Accumulated deficit                           (417,283)      (302,898)
       Accumulated other comprehensive income           2,805          2,771
         Total stockholders' equity                   526,259        583,258
         Total liabilities and
          stockholders' equity                     $1,796,945     $1,647,407
 
 
                       LEAP WIRELESS INTERNATIONAL, INC.
 
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)
                     (In thousands, except per share data)
 
                                                Three Months Ended
                                                      March 31,
                                                                  2000 Pro
                                          2001         2000       Forma(1)
     Revenues:
       Service revenues                  $25,655       $9,418      $2,762
       Equipment revenues                 11,098          573       1,437
         Total revenues                   36,753        9,991       4,199
     Operating expenses:
       Cost of service                   (12,226)      (2,783)     (1,312)
       Cost of equipment                 (30,938)     (13,248)     (4,459)
       Selling and marketing             (17,015)      (6,676)     (1,476)
       General and administrative
        expenses                         (24,686)     (15,427)    (11,791)
       Depreciation and amortization     (14,787)      (5,242)     (6,029)
         Total operating expenses        (99,652)     (43,376)    (25,067)
       Operating loss                    (62,899)     (33,385)    (20,868)
     Equity in net loss of
      investments in and loan
      receivable from unconsolidated
      wireless operating companies       (26,182)     (29,583)    (19,144)
     Interest income                      10,899        4,691       4,687
     Interest expense                    (37,611)     (16,160)    (13,890)
     Foreign currency transaction
      gains (losses), net                 (1,235)       1,399          --
     Other income, net                     3,576          635         665
     Loss before income taxes
      and extraordinary item            (113,452)     (72,403)    (48,550)
     Income taxes                           (933)          --          --
     Loss before extraordinary item     (114,385)     (72,403)    (48,550)
 
     Extraordinary loss on early
      extinguishment of debt                  --       (4,422)     (4,422)
         Net loss                      $(114,385)    $(76,825)   $(52,972)
     Basic and diluted net loss
      per common share:
       Loss before extraordinary item     $(3.88)      $(3.23)     $(2.17)
       Extraordinary loss                     --        (0.20)      (0.20)
         Net loss                         $(3.88)      $(3.43)     $(2.37)
     Shares used in per share
      calculations:
       Basic and diluted                  29,462       22,397      22,397
 
     (1) The pro forma results for the three months ended March 31, 2000 assume
         that the Company had purchased substantially all the assets of Chase
         Telecommunications Holdings, Inc. on January 1, 2000 and had sold its
         interest in Smartcom S.A. on December 31, 1999.
 
 
                       LEAP WIRELESS INTERNATIONAL, INC.
 
                             SELECTED SEGMENT DATA
                                  (UNAUDITED)
                                 (In thousands)
 
                                                        As of and for the
                                                        Three Months Ended
                                                            March 31,
                                                       2001          2000
     United States:
     Revenues                                         $36,753         $4,199
     EBITDA                                           (41,017)        (8,837)
     Operating loss                                   (55,358)       (14,506)
     Capital expenditures                             (86,037)       (35,886)
     Purchase of wireless licenses                     (6,714)       (73,154)
     Total assets                                   1,173,583        213,635
 
     Mexico(1):
     Revenues                                          38,295          4,652
     EBITDA                                           (87,871)       (48,482)
     Operating loss                                  (100,660)       (53,509)
     Capital expenditures                             (99,133)       (66,067)
     Total assets                                     806,215        597,566
 
     (1) The results of the Mexico segment are for the quarters ended December
         31, 2000 and 1999, a three month reporting lag.
 
 SOURCE  Leap Wireless International, Inc.