UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

For the quarterly period ended JUNE 30, 1998

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

For the transition period from____________ to______________

                              333-06609-01
Commission file number________333-06609-02___________


                              SPRINT SPECTRUM L.P.
                       SPRINT SPECTRUM FINANCE CORPORATION
             (Exact name of registrant as specified in its charter)

      DELAWARE                                              48-1165245
      DELAWARE                                              43-1746537
(State or other jurisdiction                             (IRS Employer
of incorporation or organization)                       Identification No.) 
                                                                 

                 4900 Main Street, Kansas City, Missouri, 64112
--------------------------------------------------------------------------------
         (Address of principal executive offices)

                                 (816) 559-1000
--------------------------------------------------------------------------------
   (Registrant's telephone number, including area code)


--------------------------------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

Yes      X                 No

As of August 1, 1998,  Sprint  Spectrum  Finance  Corporation  had Common  Stock
outstanding of 100 shares.


<PAGE>


                              SPRINT SPECTRUM L.P.
                       SPRINT SPECTRUM FINANCE CORPORATION
                  FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1998

                                      INDEX

                                                                        Page
                                                                       Number
                                                                     -----------

Part I - Financial Information.........................................   1 - 21

  Item 1a.  Financial Statements - Sprint Spectrum L.P.................   1 - 7

     Consolidated Condensed Balance Sheets.............................     1

     Consolidated Condensed Statements of Operations...................     2

     Consolidated Condensed Statements of Cash Flows...................     3

     Notes to Consolidated Condensed Financial Statements..............   4 - 7

  Item 1b.  Financial Statements - Sprint Spectrum Finance Corporation.   8 - 11

     Condensed Balance Sheets..........................................     8

     Condensed Statements of Operations................................     9

     Condensed Statements of Cash Flows................................     10

     Notes to Condensed Financial Statements...........................     11

  Item 2a.  Management's Discussion and Analysis of Financial Condition   
     and Results of Operations - Sprint Spectrum L.P...................  12 - 20

  Item 2b.  Management's Discussion and Analysis of Financial Condition     
     and Results of Operations - Sprint Spectrum Finance Corporation...     21 
Part II - Other Information

  Item 1.  Legal Proceedings...........................................  22 - 23

  Item 2.  Changes in Securities.......................................     23

  Item 3.  Defaults On Senior Securities...............................     23

  Item 4.  Submission of Matters to a Vote of Security Holders.........     24

  Item 5.  Other Information...........................................     24

  Item 6.  Exhibits and Reports on Form 8-K............................  24 - 25

Signature..............................................................  26 - 27

Exhibits






<PAGE>



                                                      
                                                                         PART I.
                                                                        Item 1a.
<TABLE>

                              SPRINT SPECTRUM L.P.
                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                 (In Thousands)

                                                               June 30,      December 31,
                                                                 1998           1997
                                                            -------------   -------------
-------------------------------------------------------
                                                             (unaudited)
                               ASSETS

CURRENT ASSETS:
<S>                                                         <C>            <C>         
   Cash and cash equivalents...........................     $    78,043    $     36,821
   Accounts receivable, net............................         126,495          96,318
   Receivable from affiliates..........................          63,834         105,156
   Inventory...........................................         120,359          96,907
   Prepaid expenses and other assets...................          41,210          25,353
                                                            -------------   -------------
     Total current assets..............................         429,941         360,555

INVESTMENT IN PCS LICENSES, net........................       2,059,200       2,085,836

PROPERTY, PLANT AND EQUIPMENT, net.....................       3,414,104       3,132,664

MICROWAVE RELOCATION COSTS, net........................         268,131         250,397

OTHER ASSETS, net......................................          91,407         101,465

                                                            =============   =============
TOTAL ASSETS...........................................     $ 6,262,783    $   5,930,917
                                                            =============   =============

                  LIABILITIES AND PARTNERS' CAPITAL

CURRENT LIABILITIES:
   Accounts payable....................................     $   237,414    $    305,524
   Payable to affiliates...............................               -           1,190
   Accrued interest....................................          76,860          45,851
   Accrued expenses....................................         292,149         227,890
   Current maturities of long-term debt ...............          11,694          11,380
                                                            -------------   -------------
     Total current liabilities.........................         618,117         591,835

CONSTRUCTION OBLIGATIONS...............................         397,492         705,280

LONG TERM DEBT.........................................       4,615,130       3,101,539

OTHER NONCURRENT LIABILITIES...........................          70,779          48,975

COMMITMENTS AND CONTINGENCIES

LIMITED PARTNER INTEREST IN CONSOLIDATED SUBSIDIARY....           5,000           5,000

PARTNERS' CAPITAL AND ACCUMULATED DEFICIT:
   Partners' capital...................................       3,437,565       3,437,565
   Accumulated deficit.................................      (2,881,300)     (1,959,277)
                                                            -------------   -------------
     Total partners' capital...........................         556,265       1,478,288

                                                            =============   =============
TOTAL LIABILITIES AND PARTNERS' CAPITAL................     $ 6,262,783    $  5,930,917
                                                            =============   =============



See notes to consolidated condensed financial statements.
</TABLE>
<PAGE>


                                                                         PART I.
                                                                        Item 1a.

                              SPRINT SPECTRUM L.P.
           CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
                                 (In Thousands)



<TABLE>


                                                 Three Months Ended          Six Months Ended
                                                      June 30,                   June 30,
                                          ----------------------------   -------------------------
                                              1998           1997            1998         1997
--------------------------------------    ------------    ------------   -------------  ----------


<S>                                       <C>              <C>            <C>           <C>      
OPERATING REVENUES.....................   $   192,294      $  25,386      $  336,104    $  34,853

OPERATING EXPENSES:
   Cost of revenues....................       205,311         88,294         374,196      136,121
   Selling, general and administrative.       223,014        148,504         447,596      266,576
   Depreciation and amortization.......       149,856         66,300         264,527      100,682
                                          ------------    ------------   -------------  ----------
     Total operating expenses..........       578,181        303,098       1,086,319      503,379

LOSS FROM OPERATIONS...................      (385,887)      (277,712)       (750,215)    (468,526)

OTHER INCOME (EXPENSE):
   Interest, net ......................       (98,342)       (11,705)       (175,649)     (10,897)
   Other income........................         1,996          1,753           3,841        2,875
                                          ------------    ------------   -------------  ----------

     Total other income (expense)......       (96,346)        (9,952)       (171,808)      (8,022)

                                          ============    ============   =============  ==========
NET LOSS...............................   $  (482,233) $    (287,664)     $ (922,023)   $(476,548)
                                          ============    ============   =============  ==========


See notes to consolidated condensed financial statements.
</TABLE>
<PAGE>



                                 
                                                                         PART I.
                                                                        Item 1a.
                              SPRINT SPECTRUM L.P.
           CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
                                 (In Thousands)




<TABLE>
                                                                     Six Months Ended
                                                                          June 30,
                                                                -----------------------------
                                                                      1998          1997
--------------------------------------------------------------  --------------  -------------

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                              <C>            <C>        
   Net loss...................................................   $  (922,023)   $ (476,548)
   Adjustments to reconcile net loss to net cash provided by
        (used in) operating activities:
     Depreciation and amortization............................       264,527        100,682
     Amortization of debt discount and issuance costs.........        26,508         22,615
     Changes in assets and liabilities:
       Receivables............................................        14,006        (29,541)
       Inventory..............................................       (23,452)       (11,824)
       Prepaid expenses and other assets......................       (12,164)        (8,664)
       Accounts payable and accrued expenses..................        25,968         (3,552)
       Other non current liabilities..........................        21,804          8,917
                                                                --------------  -------------
                                                                                             
         Net cash used in operating activities................      (604,826)      (397,915)

CASH FLOWS FROM INVESTING ACTIVITIES:
   Capital expenditures.......................................      (516,145)    (1,202,946)
   Microwave relocation costs.................................       (23,781)       (80,035)
                                                                --------------  -------------
         Net cash used in investing activities................      (539,926)    (1,282,981)

CASH FLOWS FROM FINANCING ACTIVITIES:
   Capital contributions......................................             -        175,000
   Net borrowing under revolving credit agreement.............       760,000        390,000
   Proceeds from issuance of long-term debt...................       737,030        766,128
   Change in construction obligations.........................      (307,788)       452,206
   Payments on long-term debt.................................        (3,268)       (40,023)
   Debt issuance costs........................................             -        (20,000)
                                                                --------------  -------------
         Net cash provided by financing activities............     1,185,974      1,723,311
                                                                --------------  -------------
INCREASE  IN CASH AND CASH EQUIVALENTS........................        41,222         42,415

CASH AND CASH EQUIVALENTS, Beginning of period................        36,821         49,988

                                                                --------------  -------------
CASH AND CASH EQUIVALENTS, End of period......................   $    78,043    $    92,403
                                                                ==============  =============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
    Interest paid, net of amount capitalized..................   $    63,137    $        27

NON-CASH INVESTING AND FINANCING ACTIVITIES:

    - Accrued interest of $46.2 million and  $78.2 million
   related to vendor  financing was converted to long-term debt 
   during the three and six months ended June 30, 1998,
   respectively.



See notes to consolidated condensed financial statements.
</TABLE>
<PAGE>





                                                                         PART I.
                                                                        Item 1a.
                              SPRINT SPECTRUM L.P.
        Notes to Consolidated Condensed Financial Statements (Unaudited)


The information  contained in this Form 10-Q for the three and six month interim
periods  ended  June 30,  1998 and 1997 has been  prepared  in  accordance  with
instructions  to Form 10-Q and Rule 10-01 of  Regulation  S-X. In the opinion of
management,  all  adjustments  considered  necessary,  consisting only of normal
recurring  accruals,  to present  fairly the  consolidated  financial  position,
results of  operations,  and cash flows for such interim  periods have been made
(See Note 1).

Certain information and footnote  disclosures  normally included in consolidated
financial  statements  prepared in accordance with generally accepted accounting
principles  have been  condensed or omitted.  The results of operations  for the
three and six months ended June 30, 1998 are not  necessarily  indicative of the
operating  results  that may be expected  for the year ended  December 31, 1998.
These unaudited  consolidated  condensed financial  statements should be read in
conjunction  with the  consolidated  financial  statements and the notes thereto
included in the 1997 Annual  Report on Form 10-K filed by Sprint  Spectrum  L.P.
and Sprint Spectrum Finance Corporation.

1.    Organization

Sprint Spectrum L.P. (the "Company") is a limited partnership formed in Delaware
on March 28, 1995, by Sprint Spectrum  Holding  Company,  L.P.  ("Holdings") and
MinorCo, L.P. ("MinorCo") both of which were formed by Sprint Enterprises, L.P.,
TCI Spectrum  Holdings,  Inc., Cox Telephony  Partnership and Comcast  Telephony
Services  (together the  "Partners").  The Partners are  subsidiaries  of Sprint
Corporation ("Sprint"),  Tele-Communications,  Inc. ("TCI"), Cox Communications,
Inc. ("Cox"),  and Comcast Corporation  ("Comcast" and together with Sprint, TCI
and Cox,  the  "Parents"),  respectively.  The  Partnership  and  certain  other
affiliated partnerships offer services as Sprint PCS.

The partners of the Company have the  following  ownership  interests as of June
30, 1998 and 1997:

   Sprint Spectrum Holding Company, L.P. (general partner)....greater than 99%
   MinorCo, L.P. (limited partner)................................less than 1%

The  Company  is   consolidated   with  its   subsidiaries,   WirelessCo,   L.P.
("WirelessCo"), Sprint Spectrum Equipment Company, L.P. ("EquipmentCo"),  Sprint
Spectrum  Realty  Company,   L.P.   ("RealtyCo")  and  Sprint  Spectrum  Finance
Corporation  ("FinCo").  WirelessCo  was formed on October  24, 1994 to develop,
operate and manage an integrated wireless business. On May 15, 1996, EquipmentCo
was  formed  to lease  or own  wireless  communication  network  equipment,  and
RealtyCo  was  formed  to  lease  or  own  real   property  on  which   wireless
communication facilities are to be located. On May 20, 1996, FinCo was formed to
be a co-obligor of the senior notes and senior discount notes.

Sprint Recapitalization - Sprint has entered into a restructuring agreement with
TCI, Comcast and Cox (the "Cable Parents") to restructure  Sprint's wireless PCS
operations  (the "PCS  Restructuring")  subject  to Sprint  stockholder  and FCC
approvals.  If the PCS Restructuring occurs as planned,  Sprint will acquire the
joint  venture  interests  of TCI,  Comcast  and Cox in Sprint PCS and the joint
venture  interest of TCI and Cox in  PhillieCo  Partners I, L.P.  and  PhillieCo
Partners  II, L.P. In exchange  for these joint  venture  interests,  Sprit will
issue to TCI, Comcast, and Cox a newly created class of Sprint common stock (the
"PCS Stock"). The PCS Stock will be

<PAGE>


intended to reflect  separately  the  performance  of these joint  ventures  and
Sprint's  other PCS  interests.  The  operations  will be referred to as the PCS
Group.

Deadlock Event - The proposed  budget for fiscal year 1998 has not been approved
by the  Holdings  partnership  board,  which  resulted  in the  occurrence  of a
"Deadlock Event" as of January 1, 1998 under the Amended and Restated  Agreement
of Limited  Partnership  of  MajorCo,  L.P.  (renamed  Sprint  Spectrum  Holding
Company,  L.P.) dated January 31, 1996 (the "Holdings  Partnership  Agreement").
Holdings is the sole general  partner of Sprint Spectrum L.P. Under the Holdings
Partnership  Agreement,  if one of the  Partners  refers the budget issue to the
chief  executive  officers of the Parents for  resolution  pursuant to specified
procedures  and the  issue  remains  unresolved,  buy/sell  provisions  would be
triggered which may result in the purchase by one or more of the Partners of the
interest of the other Partners, or, in certain circumstances, the liquidation of
Holdings and it subsidiaries. Discussions among the Partners about restructuring
their  interests in Holdings,  in lieu of triggering  such buy/sell  procedures,
have resulted in the Partners entering into a restructuring  agreement dated May
26,  1998.  See  "Sprint   Recapitalization"  above  for  a  discussion  of  the
restructuring agreement between the Partners.

2.    Summary of Significant Accounting Policies

Basis of Presentation - The assets, liabilities,  results of operations and cash
flows of  entities in which the Company  has a  controlling  interest  have been
consolidated.  All significant  intercompany accounts and transactions have been
eliminated.

Accounts  Receivable - Accounts  receivable are net of an allowance for doubtful
accounts of  approximately  $20.8  million and $9.0 million at June 30, 1998 and
December 31, 1997 respectively.

Investment  in PCS Licenses - During 1994 and 1995,  the Federal  Communications
Commission ("FCC") auctioned PCS licenses in specific  geographic service areas.
The FCC grants  licenses  for terms of up to ten  years,  and  generally  grants
renewals if the licensee has complied with its license obligations.  The Company
believes  it will be able to  secure  renewal  of the PCS  licenses  used by its
subsidiaries.  PCS licenses are amortized  over 40 years once placed in service.
Accumulated  amortization for PCS licenses totaled  approximately  $71.6 million
and $45.0 million as of June 30, 1998 and December 31, 1997, respectively.

Microwave Relocation Costs - The Company has also incurred costs associated with
microwave  relocation  in  the  construction  of  the  PCS  network.   Microwave
relocation costs are amortized over 40 years,  consistent with the PCS licenses.
Accumulated  amortization for microwave  relocation costs totaled  approximately
$8.4  million  and $5.2  million  as of June 30,  1998 and  December  31,  1997,
respectively.

Intangible  Assets - The ongoing value and  remaining  useful life of intangible
assets are subject to periodic  evaluation.  The Company  currently  expects the
carrying  amounts  to be  fully  recoverable.  Impairments  of  intangibles  and
long-lived assets are assessed based on an undiscounted cash flow methodology.

Capitalized  Interest -  Interest  costs  associated  with the  construction  of
capital  assets  (including  the PCS  licenses)  incurred  during  the period of
construction are capitalized.  The total interest capitalized for the six months
ended June 30, 1998 and 1997 was approximately  $22.1 million and $70.4 million,
respectively.

Debt  Issuance  Costs -  Included  in other  assets  are costs  associated  with
obtaining  financing.  Such costs are  capitalized  and  amortized  to  interest
expense  over the term of the  related  debt  instruments  using  the  effective
interest method. Accumulated amortization at June 30, 1998 and December 31, 1997
totaled approximately $19.6 million and $13.3 million, respectively.


<PAGE>



Income  Taxes - The Company has not  provided  for federal or state income taxes
since such taxes are the responsibility of the individual Partners.

Use of Estimates - The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles requires management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and reported  amounts of revenues and expenses  during the reporting
period. Actual results could differ from those estimates.

Reclassification  -  Certain  reclassifications  have  been  made  to  the  1997
consolidated  condensed  financial  statements to conform to the 1998  statement
presentation.

3.    Long-Term Debt and Borrowing Arrangements

Bank Credit  Facility - The Company  entered  into an  agreement  with The Chase
Manhattan  Bank  ("Chase") as agent for a group of lenders for a $2 billion bank
credit  facility  dated October 2, 1996. The proceeds of this facility are to be
used to finance working capital needs,  subscriber  acquisition  costs,  capital
expenditures and other general Company purposes.

The facility  consists of a revolving  credit  commitment  of $1.7 billion and a
$300 million term loan commitment.  In December 1997,  certain terms relating to
the  financial and operating  conditions  were amended.  As of June 30, 1998 the
term loans have a weighted  average interest rate of 8.19%. As of June 30, 1998,
$1.4 billion had been drawn under the  revolving  credit  facility at a weighted
average  interest  rate of  8.21%  with  $300.0  million  remaining  immediately
available.  Commitment  fees for the  revolving  portion  of the  agreement  are
payable quarterly based on average unused revolving commitments.

Vendor  Financing - As of October 2, 1996,  the Company  entered into  financing
agreements with Northern Telecom Inc.  ("Nortel") and Lucent  Technologies  Inc.
("Lucent",  and together with Nortel,  the "Vendors") for multiple drawdown term
loan  facilities  totaling  $1.3  billion and $1.8  billion,  respectively.  The
proceeds of such  facilities are to be used to finance the purchase of goods and
services  provided by the Vendors.  Additionally,  the commitments allow for the
conversion of accrued  interest into additional  principal.  Such conversions do
not reduce the availability under the commitments. Interest accruing on the debt
outstanding  at March 31,  1999,  can be  converted  into  additional  principal
through   February  8,  2000  and  March  30,  2000,   for  Lucent  and  Nortel,
respectively.

On April 30, 1997 and November 20,  1997,  the Company  amended the terms of its
financing agreement with Nortel. The amendments provide for a syndication of the
financing  commitment  between  Nortel,  several  banks and other  vendors  (the
"Nortel  Lenders")  and the  modification  of certain  operating  and  financial
covenants.  As of June 30, 1998,  $835.2 million,  including  converted  accrued
interest of $46.1  million,  had been borrowed at an interest rate of 8.84% with
$510.9 million remaining available under the first phase.

On May 29 and December 15, 1997, the Company  amended the terms of its financing
agreement with Lucent. The amendment provides for a syndication of the financing
commitment  between  Lucent,  Sprint and other  banks and vendors  (the  "Lucent
Lenders") and the modification of certain operating and financial covenants. The
Lucent  Lenders have  committed to financing up to an aggregate of $1.8 billion,
with Sprint  financing up to $300 million.  As of June 30, 1998, the Company had
borrowed  approximately  $1.5 billion,  including  converted accrued interest of
$83.8 million,  at a weighted average interest rate of 8.76% with $383.8 million
remaining available.


<PAGE>



Certain  amounts  included under  Construction  Obligations on the  consolidated
condensed   balance  sheets  may  be  financed  under  the  Vendors'   financing
agreements.


5.    Contingencies and Commitments

Procurement  Contract- On May 8, 1998, the Company  amended its  procurement and
services agreement with Lucent. The amendment provides for an additional pricing
structure for certain equipment,  software and engineering services purchased by
the Company from Lucent after  January 1, 1998.  Significant  original  contract
provisions,  including  but not limited to, the length of the  contract  and the
payment terms, have not been amended. The minimum commitment under the amendment
is approximately $353 million.

Litigation - The Company is involved in various legal proceedings  incidental to
the conduct of its business.  While it is not possible to determine the ultimate
disposition of each of these proceedings,  the Company believes that the outcome
of such proceedings, individually and in the aggregate, will not have a material
adverse effect on the Company's financial condition or results of operations.




<PAGE>


                                                                         Part I.
                                                                        Item 1b.


                       SPRINT SPECTRUM FINANCE CORPORATION
               (A wholly-owned subsidiary of Sprint Spectrum L.P.)
                            CONDENSED BALANCE SHEETS

<TABLE>
                                                                June 30,   December 31,
                                                                  1998         1997
  ----------------------------------------------------------   ----------   ----------
                                                               (Unaudited)
                                     ASSETS

<S>                                                            <C>          <C>   
  Receivable from parent.....................................  $    -       $    -
                                                               ----------   ----------

  TOTAL ASSETS...............................................  $    -       $    -
                                                               ==========   ==========

                LIABILITIES AND STOCKHOLDER'S EQUITY

  Payable to parent..........................................  $  1,497     $   1,497

  STOCKHOLDER'S EQUITY:

    Common stock, $1.00 par value; 1,000 shares authorized;
          100 shares issued and outstanding..................       100          100

    Accumulated deficit......................................    (1,597)       (1,597)
                                                               ----------   ----------
         Total stockholders' equity..........................    (1,497)       (1,497)


    TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY...............
                                                               $    -       $    -
                                                               ==========   ==========


See notes to condensed financial statements.
</TABLE>
<PAGE>

                                                                         Part I.
                                                                        Item 1b.

                       SPRINT SPECTRUM FINANCE CORPORATION
               (A wholly-owned subsidiary of Sprint Spectrum L.P.)
                 CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)



                               Three Months Ended      Six Months Ended
                                   June 30,                 June 30,
                           -----------------------  -----------------------
                              1998         1997        1998         1997       
                           ----------   ----------  ----------   ----------

Operating Revenues....     $     -      $    -      $     -      $    - 

Operating Expenses....           -           -            -           -
                           ----------   ----------  ----------   ----------

Net Loss..............     $     -      $    -      $     -      $    -
                           ==========   ==========  ==========   ==========















See notes to condensed financial statements.
<PAGE>

<TABLE>

                                                                         Part I.
                                                                        Item 1b.

                       SPRINT SPECTRUM FINANCE CORPORATION
               (A wholly-owned subsidiary of Sprint Spectrum L.P.)
                 CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)




                                                                   Six Months Ended
                                                            June 30, 1998    June 30, 1997
                                                            --------------  --------------- 

<S>                                                           <C>             <C> 
CASH FLOWS FROM OPERATING ACTIVITIES:
   Adjustments to reconcile net loss to net cash used in
   operating activities:
      Net loss............................................    $     -         $     -
      Changes in assets and liabilities:
         Receivable from parent...........................          -               -
         Payable to parent................................          -               -
                                                            --------------  ---------------
           Net cash used in operating activities..........          -               -

 CASH FLOWS FROM FINANCING ACTIVITIES:
   Issuance of common stock...............................          -               -
                                                            --------------  --------------  
                                                                              
           Net cash provided by financing activities......          -               -
                                                            --------------  --------------
 INCREASE (DECREASE) IN CASH AND
   CASH EQUIVALENTS.......................................          -               -

 CASH AND CASH EQUIVALENTS, Beginning of Period...........          -               - 
                                                            ==============  ==============
 CASH AND CASH EQUIVALENTS, End of Period.................    $     -         $     -
                                                            ==============  ==============


See notes to condensed financial statements.
</TABLE>
<PAGE>





                                                                         Part I.
                                                        
                       SPRINT SPECTRUM FINANCE CORPORATION
               (A wholly-owned subsidiary of Sprint Spectrum L.P.)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS


The information  contained in this Form 10-Q for the three and six month interim
period  ended  June 30,  1998 and 1997 has  been  prepared  in  accordance  with
instructions  to Form 10-Q and Rule 10-01 of  Regulation  S-X. In the opinion of
management,  all  adjustments  considered  necessary,  consisting only of normal
recurring  accruals,  to present  fairly the  consolidated  financial  position,
results of operations, and cash flows for such interim periods have been made.

Certain  information  and footnote  disclosures  normally  included in financial
statements prepared in accordance with generally accepted accounting  principles
have been condensed or omitted.  The results of operations for the three and six
months  ended June 30,  1998 are not  necessarily  indicative  of the  operating
results  that may be  expected  for the year  ended  December  31,  1998.  These
unaudited condensed financial  statements should be read in conjunction with the
financial statements and the notes thereto included in the 1997 Annual Report on
Form 10-K filed by Sprint Spectrum L.P. and Sprint Spectrum Finance Corporation.


1.    Organization

Sprint Spectrum  Finance  Corporation  ("FinCo"),  a Delaware  corporation,  was
formed on May 21, 1996 and is a wholly-owned  subsidiary of Sprint Spectrum L.P.
(the  "Partnership").  FinCo was formed to be a  co-obligor  of $250  million in
senior notes and $500 million in senior discount notes.  FinCo pays a management
fee to the  Partnership  based on actual  expenses  paid by the  Partnership  of
behalf of FinCo.  The losses  generated by the  management fee incurred by FinCo
will be funded by the Partnership.

The  Partnership  contributed  $100 to FinCo on May 21, 1996 in exchange for 100
shares of common stock.

<PAGE>


                                                                         PART I.
                                                                        Item 2a.
                              SPRINT SPECTRUM L.P.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following  discussion and analysis should be read in conjunction with Sprint
Spectrum L.P.'s consolidated  condensed financial  statements and notes thereto.
The  term  "Company"  refers  to  Sprint  Spectrum  L.P.  and its  subsidiaries,
including FinCo, WirelessCo, RealtyCo, and EquipmentCo.

The Company includes certain  estimates,  projections and other  forward-looking
statements in its reports as well as in presentations to analysts and others and
in other  material  disseminated  to the public.  There can be no  assurances of
future  performance  and actual results may differ  materially from those in the
forward-looking  statements.  Factors which could cause actual results to differ
materially from estimates or projections contained in forward-looking statements
include:

  -  the  establishment  of a market  for new  digital  personal  communications
     services ("PCS");
  -  the introduction of competitive service plans and pricing and other effects
     of  vigorous  competition  in the  markets in which the  Company  currently
     operates or intends to market its services;
  -  the impact of technological change which may diminish the value of existing
     equipment which may, in turn,  result in the need to incur additional costs
     to upgrade previously sold communications equipment;
  -  the cost of entering new markets necessary to provide services;
  -  the impact of any unusual items  resulting from ongoing  evaluations of the
     Company's business strategies;
  -  the impact of changes brought about by possible  restructuring of partners'
     ownership interests;
  -  the effects of  unanticipated  delays or problems with the  development  of
     technologies and systems used by the Company;
  -  requirements  imposed on the  Company  and its  competitors  by the Federal
     Communications  Commission  ("FCC") and state regulatory  commissions under
     the Telecommunications Act of 1996;
  -  the  possibility  of one or more of the markets in which the  Company  will
     compete  being  impacted  by  variations  in  political,  economic or other
     factors over which the Company has no control;
  -  the effects of unanticipated delays resulting from zoning or other disputes
     with municipalities; and
  -  unexpected results in litigation.

General

License and Network  Coverage - The Company owns 30 PCS licenses  granted in the
FCC's A Block and B Block PCS  auction,  which  concluded  in March 1995.  These
licenses allow the Company to provide service to 30 major trading areas ("MTAs")
covering  approximately  155.9 million Pops. The Company has also affiliated and
expects  to  continue  to  affiliate  with  other  PCS  providers.  Pursuant  to
management and affiliation agreements, each affiliated PCS service provider will
use  the  Sprint(R)   and  Sprint  PCSSM  brand  names,   trademarks  of  Sprint
Communications Company L.P. ("Sprint Communications").

In 1997  the  Company  commenced  service  in all of the MTAs in which it owns a
license and expects to continue  to incur  additional  construction  costs as it
expands  coverage in existing  license  areas.  Additionally,  the Company  will
require  substantial  working  capital  to fund  initial  operating  activities,
including  the  up-front  customer  acquisition  costs.  The extent to which the
Company is able to generate  operating  revenue and  earnings is  dependent on a
number of business factors, including maintaining existing financing, generating
operating  revenues,  and attaining  profitable  levels of market demand for the
Company's products and services.

<PAGE>




Affiliations  - The Company  currently  affiliates  with or provides  management
services to entities  in which the  Partners  have an  ownership  interest.  The
Company  has an  affiliation  agreement  with  American  PCS,  L.P.  ("APC"),  a
subsidiary of Holdings, which, through subsidiaries,  owns a PCS license for and
operates both a broadband CDMA (code division  multiple  access) network and GSM
(global   system  for   mobile   communications)   network  in  the   Washington
D.C./Baltimore  area MTA,  which  covers  approximately  8.3 million  Pops.  APC
launched CDMA service at the end of the first quarter of 1998.  The Company also
affiliates with Cox Communications PCS, L.P. ("Cox PCS"), a limited partnership,
in which Holdings is managing  partner and has a 59.2% ownership  interest.  Cox
PCS owns a PCS license for the Los Angeles-San Diego MTA covering  approximately
21.0 million Pops.

The Company provides  management services to SprintCom,  Inc.  ("SprintCom") and
PhillieCo,  L.P. ("PhillieCo").  SprintCom, a wholly-owned subsidiary of Sprint,
participated  in the FCC's D and E Block  auction  which ended January 14, 1997,
and was  awarded  licenses  for 139 of 493  BTAs,  covering  approximately  74.9
million  Pops,  all of which are  geographic  areas not covered by the Company's
owned PCS licenses or licenses owned by APC, Cox PCS or PhillieCo.  PhillieCo is
a limited partnership organized by and among subsidiaries of Sprint, TCI and Cox
that owns a PCS license for the  Philadelphia  MTA  covering  approximately  9.2
million Pops.

In June 1998, the Company also entered into various  management  agreements with
other  companies  pursuant to which such other companies (each a "Manager") will
build  networks in portions of the  Company's  licensed  coverage  area and then
affiliate  the  Manager's  network with the  Company's  network.  These  Manager
networks  will be built using the same  technological  standards as those of the
Company,  and the  Managers  will use the Sprint PCS brand name to market  their
services  and will be required  to  maintain  certain  quality  standards  to be
established by the Company. The Company entered into 11 additional agreements in
July and intends to continue to enter into additional management agreements as a
means of expanding its existing network.

Sprint Recapitalization - Sprint has entered into a restructuring agreement with
TCI, Comcast and Cox (the "Cable Parents") to restructure  Sprint's wireless PCS
operations  (the "PCS  Restructuring")  subject  to Sprint  stockholder  and FCC
approvals.  If the PCS Restructuring occurs as planned,  Sprint will acquire the
joint  venture  interest  of TCI,  Comcast  and Cox in Sprint  PCS and the joint
venture  interest of TCI and Cox in  PhillieCo  Partners I, L.P.  and  PhillieCo
Partners II, L.P. In exchange  for these joint  venture  interests,  Sprint will
issue to TCI,  Comcast and Cox a newly created class of Sprint common stock (the
"PCS  Stock").  The PCS  Stock  will  be  intended  to  reflect  separately  the
performance  of these joint  ventures  and  Sprint's  other PCS  interests.  The
operations will be referred to as the PCS Group.

Roaming - The Company has entered into roaming  agreements  with various  analog
cellular providers  throughout the United States and Canada.  Additionally,  the
Company has  negotiated  roaming  arrangements  with other CDMA PCS carriers who
provide service in geographic areas not currently covered by the CDMA network of
Sprint Spectrum and its affiliates.  As a result, Sprint Spectrum customers with
dual-mode   handsets  capable  of  transmitting   over  cellular  and  CDMA  PCS
frequencies  have  the  ability  to roam  automatically  in areas  where  Sprint
Spectrum service is not available and where there are roaming agreements.


Continuing Risk Factors

Year 2000 Issue - The "Year  2000"  affects  the  Company's  installed  computer
systems,  network elements,  software  applications,  and other business systems
that have time sensitive programs that may not properly reflect

<PAGE>


or recognize the year 2000.  Because many  computers  and computer  applications
define  dates by the last  two  digits  of the  year,  "00" may not be  properly
identified  as the year 2000.  This error  could  result in  miscalculations  or
system errors.  The Year 2000 issue may also affect the systems and applications
of the Company's customers, vendors or resellers.

The Company is undertaking  an inventory and assessment of its compute  systems,
network  elements,  software  applications  and other  business  systems.  It is
planning that Year 2000 compliance for these critical  business  systems will be
achieved in 1999.. The Company is also contacting  others with whom they conduct
business to receive the  appropriate  warranties and assurances that those third
parties are or will be Year 2000 compliant.  The total cost of modifications and
conversions  is not  known  at this  time;  however,  it is not  expected  to be
material to the Company's  financial position and is being expensed as incurred.
In addition  the Company  uses  publicly  available  services  that are acquired
without  contract (e.g.,  global  positioning  system timing signal) that may be
subject to the Year 2000 issue. While the Company believes these systems will be
Year 2000  compliant,  the Company has no  contractual  or other right to compel
compliance.

If compliance is not achieved in a timely manner, the Year 2000 issue could have
a material adverse effect on the Company's  operations.  However, the Company is
focusing on identifying and addressing all aspects of its operations that may be
affected by the Year 2000 issue and is addressing the most critical applications
first. The Company intends to develop and implement,  if necessary,  appropriate
contingency   plans  to   mitigate  to  the  extent   possible   any  Year  2000
noncompliance.

Deadlock Event - A proposed budget for fiscal year 1998 has not been approved by
the Holdings  partnership board, which resulted in the occurrence of a "Deadlock
Event" as of January 1, 1998 under the Holdings Partnership Agreement.  Holdings
is the  sole  general  partner  of  Sprint  Spectrum  L.P.  Under  the  Holdings
Partnership  Agreement,  if one of the  Partners  refers the budget issue to the
chief  executive  officers of the Parents for  resolution  pursuant to specified
procedures  and the  issue  remains  unresolved,  buy/sell  provisions  would be
triggered which may result in the purchase by one or more of the Partners of the
interest of the other Partners, or, in certain circumstances, the liquidation of
Holdings and it subsidiaries. Discussions among the Partners about restructuring
their  interests in Holdings,  in lieu of triggering  such buy/sell  procedures,
have resulted in the Partners entering into a restructuring  agreement dated May
26,  1998.  See  "Sprint   Recapitalization"  above  for  a  discussion  of  the
restructuring agreement between the Partners.

Business Plan - To the extent the Sprint  recapitalization is not approved,  the
Company's  business plan will require  additional capital financing prior to the
end of 1998. Sources of funding for the Company's further financing requirements
may include additional vendor financing,  public offerings or private placements
of  equity  and/or  debt  securities,   commercial  bank  loans  and/or  capital
contributions from Holdings or the Partners.  There can be no assurance that any
additional  financing can be obtained on a timely basis and on terms  acceptable
to the Company and its Partners and within  limitations  contained in the Notes,
the   agreements   governing  the  Secured   Financing  and  any  new  financing
arrangements.  Failure to obtain any such financing could result in the delay or
abandonment of the Company's  development and expansion plans and  expenditures,
the  failure  to  meet  regulatory   requirements  or  other  potential  adverse
consequences.


Liquidity and Capital Resources

The  continued  expansion of the  Company's  PCS network and the  marketing  and
distribution of the Company's PCS products and services will continue to require
substantial   capital.   The  Company  currently   estimates  that  its  capital
expenditures through 1999 will total approximately $1.8 to $2.0 billion.  Actual
amounts of the funds  required  may vary  materially  from these  estimates  and
additional funds would be required in the event of

<PAGE>


significant  departures from the current business plan,  unforeseen delays, cost
overruns, unanticipated expenses, regulatory changes, engineering design changes
and other technological risks.

The  Company's  primary uses of cash  historically  has been to fund the initial
operating  losses,  capital  expenditures  and the  acquisition of PCS licenses.
Operating losses before  depreciation  and amortization  were $485.7 million and
$367.8  million for the six months  ended June 30, 1998 and 1997,  respectively.
Capital  expenditures  totaled $516.1  million and $1,202.9  million for the six
months ended June 30, 1998 and 1997,  respectively.  Capital  expenditures  were
incurred  primarily to fund the buildout of the Company's  network.  The Company
spent $2.1 billion to acquire the PCS licenses.

Historically,  the sources of funds for the Company were  principally  long-term
debt, capital contributions and vendor financing  arrangements.  Long-term debt,
including vendor financings and construction  obligations,  totaled $5.0 billion
and $3.8  billion at June 30, 1998 and  December  31,  1997,  respectively.  The
Company  has used  vendor  financing  arrangements  to fund the  purchase of the
equipment and software manufactured by the vendors as well as a substantial part
of the  construction  labor and ancillary  equipment  (e.g.,  towers,  antennae)
required to construct  the Company's PCS network.  These  facilities  serve as a
primary financing source for the buildout of the network.

To the extent the Sprint recapitalization is not approved, the Company currently
has  limited  sources of funds to meet its capital  requirements  and has relied
upon capital contributions,  advances from Holdings, third party debt and public
debt.  The Amended and Restated  Capital  Contribution  Agreement  (the "Amended
Agreement")  dated October 2, 1996 between the Company and the Partners provided
for $3.2 billion in capital contributions. As of March 31, 1998 the Partners had
fulfilled  their  obligation  under  the  Amended  Agreement.   Further  capital
contributions  may be made by the  Partners  to  Holdings  which  may,  in turn,
contribute  capital to the Company.  However,  the Partners are not obligated to
make additional capital  contributions,  and there can be no assurance that such
contributions will be made. In October 1996 and as amended in December 1997, the
Company  entered  into a credit  agreement  with The Chase  Manhattan  Bank,  as
administrative  agent for a group of lenders,  for a $2.0 billion senior secured
credit facility (the "Bank Facility").  The proceeds of the Bank Facility are to
be used to finance working capital needs,  subscriber acquisition costs, capital
expenditures  and other  general  purposes  of the  Company.  The Bank  Facility
consists  of a  $300  million  term  loan  commitment  and  a  revolving  credit
commitment  of $1.7  billion.  As of June 30, 1998,  $300 million under the term
loan and $1.4 billion under the revolving credit facility had been borrowed with
$300 million remaining available.

Also in October 1996,  the Company  entered into credit  agreements for up to an
aggregate  of $3.1  billion  of  senior  secured  multiple  drawdown  term  loan
facilities from two of its network infrastructure  equipment vendors. As amended
in April and November 1997, the Nortel facility  provides $1.3 billion in senior
secured  loans.  The  Lucent  facility,  as amended  in May and  December  1997,
provides $1.8 billion in senior secured loans  (together the "Vendor  Financing"
and together with the Bank Facility,  the "Secured  Financing").  The Company is
using  the  proceeds  from the  Vendor  Financing  to fund the  purchase  of the
equipment and software manufactured by the vendors as well as a substantial part
of the construction  and ancillary  equipment (e.g.,  towers,  antennae,  cable)
required to construct the Company's PCS network.  These  facilities serve as the
primary  financing  mechanism  for the buildout and  continued  expansion of the
network.  The Company has borrowed $2.3  billion,  including  $130.0  million in
accrued  converted  interest,  under such  facilities at June 30, 1998, of which
$300 million was syndicated to Sprint.

The Bank Credit Facility  agreement and the Vendor Financing  agreements contain
certain restrictive  financial and operating covenants,  including,  among other
requirements,  maximum  debt ratios  (including  debt to total  capitalization),
limitations on capital expenditures,  limitations on additional indebtedness and
limitations on

<PAGE>


dividends  and  other  payment   restrictions   affecting   certain   restricted
subsidiaries. The loss of the right to use the Sprint trademark, the termination
or  non-renewal  of any FCC  license  that  reduces  population  coverage  below
specified limits, or changes in controlling interest in the Company, as defined,
among other provisions, constitute events of default.

Borrowings under the Secured Financing are secured by the Company's  interest in
WirelessCo,  RealtyCo  and  EquipmentCo  and  certain  other  personal  and real
property (the "Shared  Lien").  The Shared Lien equally and ratably  secures the
Bank  Facility and the Vendor  Financing.  The Secured  Financing is jointly and
severally guaranteed by WirelessCo, RealtyCo and EquipmentCo and is non-recourse
to the Partners and the Parents.

In August 1996,  Sprint  Spectrum  L.P. and FinCo issued $250 million  aggregate
principal  amount of the 11% Senior Notes and $500 million  aggregate  principal
amount at maturity of 12 1/2% Senior  Discount  Notes  (together,  the "Notes").
FinCo was formed solely to be a co-obligor of the Notes.  FinCo has only nominal
assets  and no  operations  or  revenues,  and  Sprint  Spectrum  L.P.  will  be
responsible for payment of the Notes.

The Senior Discount Notes were issued at a discount to their aggregate principal
amount at maturity and generated  proceeds of  approximately  $273 million.  The
proceeds of  approximately  $509  million from the issuance of the Notes (net of
approximately $14 million of underwriting discounts,  commissions,  and offering
expenses) were used to fund capital expenditures,  including the buildout of the
nationwide PCS network, to fund working capital requirements,  to fund operating
losses and for other partnership  purposes.  Sprint purchased,  and continues to
hold,  approximately  $183  million  principal  amount at maturity of the Senior
Discount Notes.  The Notes contain  certain  restrictive  covenants,  including,
among other requirements limitations on additional indebtedness,  limitations on
restricted  payments,  limitations  on liens,  and  limitations on dividends and
other payment restrictions affecting restricted subsidiaries.

For the six months ended June 30, 1998,  the Company used cash of  approximately
$605.0 million in operating activities, which consisted of the operating loss of
$922.0  million less  depreciation  and  amortization  of $291.0 million and net
changes in working  capital and other  noncurrent  liabilities of $26.2 million.
Cash used in investing activities totaled $539.9 million,  consisting of capital
expenditures  and  microwave   relocation  costs.  Cash  provided  by  financing
activities  totaled  $1.2  billion,  consisting  of  the  proceeds  from  vendor
financing,  the  revolving  credit  agreement,  and the  change in  construction
obligations.

In connection with the restructuring and recapitalization,  Sprint and the Cable
Parents have agreed to loan up to $400 million,  based on  respective  ownership
interests,  to fund the capital  requirements  of Holdings  and its  affiliates,
including  the  Company,  from the date of the signing of the PCS  Restructuring
Agreement  through the closing date. These loans may be repaid from the proceeds
of an anticipated  initial public  offering  ("IPO") by Sprint,  but only to the
extent the net proceeds of the IPO exceed $500  million.  In the event the loans
remain  outstanding  after the IPO, the remaining balance will be converted into
10-year preferred stock convertible into PCS stock.

Subsequent  to the  restructuring,  Sprint  intends  to  borrow  funds  and then
allocate the borrowings to the PCS Group  depending  upon its capital  structure
and funding  needs.  Sprint will lend to the PCS Group at rates of interest  and
with terms  consistent  with which the PCS Group  could raise funds on their own
without the support of Sprint.




<PAGE>


Seasonality

The  wireless  industry,  including  the  Company,  has  experienced  a trend of
generating a  significantly  higher number of  subscriber  additions and handset
sales in the fourth  quarter of each year as compared to the other three  fiscal
quarters. A number of factors contribute to the trend,  including the increasing
use of retail distribution,  which is dependent on the year-end holiday shopping
season,  the timing of new product and service  announcements and introductions,
competitive  pricing  pressures and aggressive  marketing and sales  promotions.
There can be no assurances  that strong fourth  quarter  results for  subscriber
additions  and handset  sales will  continue  for the  wireless  industry or the
Company.  The Company's  fourth quarter  subscriber  additions and handset sales
could be adversely  impacted by a variety of reasons,  including  the  Company's
inability to match or beat pricing plans offered by competitors,  the failure to
adequately  promote the  Company's  products,  services and pricing plans or the
failure to have an adequate  supply or selection of handsets.  If fourth quarter
results of the Company fail to significantly  improve upon subscriber  additions
and handset sales from year's previous  quarters,  the Company's results for the
year could be materially adversely affected.


Results of Operations

For the Three and Six Months Ended June 30, 1998

Operating Revenues

Revenues  and cost of revenues  have  increased  for the second  quarter and six
months ended June 30, 1998 compared to the same periods in 1997 due to increases
in the number of markets  launched  and in the number of  subscribers.  Revenues
include  service  and the sales of  handsets  and  accessory  equipment  through
multiple   distribution   channels   (including   Sprint  PCS   retail   stores,
telemarketing,  and  business  channels)  and to third  party  vendors.  Cost of
revenues  consists  principally of handset and accessory costs,  interconnection
costs and switch and cell site expenses, including site rental and utilities.



<PAGE>



Selling, General and Administrative Expenses

The  Company's  selling,  general  and  administrative  expenses  for the second
quarter of 1998 were $223.0  million  compared to $148.5  million for the second
quarter of 1997.  For the six months ended June 30, 1998,  selling,  general and
administrative expenses increased to $447.6 million from $266.6 million. For the
six months ended June 30, 1998,  selling expenses were $132.1 million,  compared
to $43.3  million for the same period in 1997.  For the second  quarter of 1998,
selling  expenses  increased to $82.7  million from $30.2  million in the second
quarter  of  1997.  Such  costs  include  participation  with  Sprint  in an NFL
sponsorship,  development and production expenses associated with advertisements
in various media (i.e.,  television,  radio,  print), the development of printed
brochures to promote the Company's  products and services,  and sales  incentive
programs.  The Company expects selling expenses will continue to increase as the
Company expands its sales and marketing activities.

General and  administrative  expenses  for the second  quarter  increased  $22.0
million  over the same period in 1997.  For the six months  ended June 30, 1998,
general and  administrative  expenses  were $315.5  million,  compared to $223.3
million for the comparable  period in 1997.  These increases are due principally
to  increases in salary and related  benefits,  computer  equipment  and related
expenses and professional and consulting fees.  Salaries and benefits,  computer
equipment  and  related  expenses  increased  due  to an  increase  in  employee
headcount.  These  additional  employees  have been  added over the last year to
support the continued  growth of the Company.  Professional  and consulting fees
increased  due to the use of  consultants  and other  experts to assist with the
continuing  development  and enhancement of the Company's  information  systems,
continued  rollout  and  tailoring  of  employee  training,  and  various  other
projects.

Depreciation and Amortization

Depreciation and amortization  expense for the second quarter of 1998 was $149.9
million compared to $66.3 million for the same period in the prior year. For the
six months ended June 30, 1998,  depreciation and amortization expense increased
$163.8  million  over the same period in 1997 as network  equipment  in launched
markets  has been  placed  in  service  and  amortization  of PCS  licenses  and
microwave relocation costs in those same markets commenced.

Other Income/Expense:

Interest Expense

Interest expense  increased to $99.1 million for the three months ended June 30,
1998, versus $12.1 million for the same period in 1997. For the six months ended
June 30, 1998,  interest  expense was $177.3 million,  compared to $12.2 million
for the same period in 1997. The balance of the Company's  construction accounts
eligible  for  interest  capitalization  declined  during  the period as markets
launched  commercial service and equipment was placed in service.  Additionally,
interest expense continues to increase as borrowings increase.

Other Income

The Company participates in affiliation  agreements with PhillieCo,  APC and Cox
PCS. For the three and six months ended June 30,  1998,  aggregate  fees of $2.0
million and $3.9 million, respectively,  earned under these agreements are shown
in other income.



<PAGE>


For the Three and Six Months Ended June 30, 1997

Operating Revenues

The Company  commenced  initial  commercial  operations  for its PCS services in
certain MTAs late in the fourth quarter of 1996 and, as a result,  had generated
minimal operating revenues.  Cost of service consisted principally of switch and
cell site expenses,  including site rental,  utilities and access charges. Prior
to service  launch,  such costs were  incurred  during the network  buildout and
testing phases. As markets  launched,  costs were incurred to provide service in
the related markets.

Selling Expenses

The Company's selling expenses for the second quarter of 1997 were $30.2 million
compared  to $0.9  million  for the second  quarter of 1996.  For the six months
ended June 30,  1997,  selling  expenses  increased  to $43.3  million from $0.9
million  for the same six  months  of 1996.  These  increases  were due to costs
incurred in preparation of and during the initial  commercial  service launch in
various  markets.  Such  costs  included  participation  with  Sprint  in an NFL
sponsorship,  development and production expenses associated with advertisements
in various  media (i.e.,  television,  radio,  print),  and the  development  of
printed brochures to promote the Company's products and services.

General and Administrative

General and administrative  expenses for the second quarter increased from $42.5
million in 1996 to $118.3 million in 1997. General and  administrative  expenses
for the six months  ended June 30,  1996 and 1997 were $73.2  million and $223.3
million,  respectively.  Increases for both the three and six month periods were
due principally to increases in salary and related benefits,  computer equipment
and  related  expenses  and  professional  and  consulting  fees.  Salaries  and
benefits,  computer  equipment and related expenses increased due to an increase
in employee headcount. Professional and consulting fees increased due to the use
of consultants  and other experts to assist with the continuing  development and
enhancement  of  the  Company's  sophisticated  information  systems,  continued
rollout and tailoring of training  programs for the Company's  sales force,  and
various other projects.

Depreciation and Amortization

Depreciation and  amortization  expense for the second quarter of 1997 was $66.3
million  compared  to $0.4  million  for the  same  period  in the  prior  year.
Depreciation and amortization expense of $100.7 million for the six months ended
June 30, 1997,  was an increase from $0.6 million for the same period in 1996 as
certain network equipment was placed in service and amortization of PCS licenses
and microwave relocation costs in the launched markets commenced.

Other Income/Expense

Interest Income/Expense

Interest income  decreased from $1.0 million for the three months ended June 30,
1996 to $0.4  million  for the three  months  ended June 30, 1997 as the average
daily invested cash balance decreased during the comparative  periods due to the
receipt in the prior year of partner equity  contributions in advance of capital
and operational  requirements.  Interest income  increased from $0.9 million for
the six months ended June 30, 1996 to $1.3 million

<PAGE>


for the six months  ended June 30, 1997 as the  Company  borrowed  funds
during the first quarter of the current year in accordance with the terms of the
loan agreements resulting in excess cash balances.

Interest  expense  increased  to $12.1 and $12.2  million  for the three and six
months  ended  June  30,  1997,  respectively,  as  the  Company's  construction
activities  declined during the period as markets launched  commercial  service,
resulting  in the  capitalization  of less  than  100% of the  interest  expense
incurred during the period. Additionally, interest expense continues to increase
as borrowings increase.

Other Income

Equity in loss of unconsolidated  partnership for the three and six months ended
June 30, 1996  represents  the  Company's  share of the losses in APC before the
ownership  interest was  transferred to Holdings on August 31, 1996. The Company
retained the rights and obligations under the affiliation agreement with APC. In
addition,  the Company  participates  in an affiliation  agreement with Cox PCS.
Fees earned  under these  agreements  of $1.8  million and $2.9  million for the
three and six  months  ended  June 30,  1997,  respectively,  are shown in other
income.

<PAGE>



                                                                         PART I.
                                                                        Item 2b.
                       SPRINT SPECTRUM FINANCE CORPORATION
               (A Wholly-Owned Subsidiary of Sprint Spectrum L.P.)
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

Sprint Spectrum  Finance  Corporation  ("FinCo"),  a Delaware  corporation,  was
formed on May 21, 1996 and is a wholly-owned  subsidiary of Sprint Spectrum L.P.
FinCo has nominal assets, does not conduct any operations and was formed to be a
co-obligor  of the  securities  issued  by the  Company.  Certain  institutional
investors  who  might  otherwise  be  limited  in their  ability  to  invest  in
securities  issued by  partnerships  by reasons of the legal  investment laws in
their states of organization or their charter  documents,  may be able to invest
in the  Company's  securities  because  FinCo is a  co-obligor.  Accordingly,  a
discussion  of the results of  operations,  liquidity  and capital  resources of
FinCo are not presented.

<PAGE>


                                                                        PART II.
                                                               Other Information
Item 1.  Legal Proceedings

         Sewell, et al. v. Sprint PCS Limited Partnership, a/k/a Sprint Spectrum
L.P.,  et al.,  Circuit  Court in Baltimore  City,  Maryland  (Civil  Action No.
S-97-3044).  In July 1997, a class action  complaint  was filed  against  Sprint
Spectrum L.P. and American PCS, L.P.,  asserting common law and statutory claims
of misrepresentation and breaches of contract and warranty. The plaintiffs claim
the  defendants  misled  customers  into buying Sprint  SpectrumSM  handsets and
services on the basis that they were  compatible  with or operable on the Sprint
PCSSM  network,  and failed to disclose  that the  technology  behind the Sprint
SpectrumSM  network  was  inferior  to the  technology  behind the Sprint  PCSSM
network.  The  plaintiffs are seeking  compensatory  and punitive  damages,  and
attorneys'  fees. The  plaintiffs'  class was certified by the court on June 29,
1998.

         Copacino,  et al.  v.  Sprint  Spectrum  L.P.,  et al.,  United  States
District Court for the District of Columbia,  Case No. 98-1180.  In July 1998, a
class action  complaint was filed against Sprint Spectrum L.P.  asserting common
law and  statutory  claims of  misrepresentation  and  breaches of contract  and
warranty.  The responsive  pleading by Sprint  Spectrum L.P. is not yet due. The
plaintiffs claim the defendants  misled customers into buying Sprint Spectrum SM
handsets and services on the basis that the Sprint  SpectrumSM  service would be
expanded to include  national  coverage  or would be linked to the Sprint  PCSSM
system.  The plaintiffs are seeking  injunctive  relief,  punitive damages,  and
attorneys fees.

         Andrew Blum, et al. vs. Sprint  Spectrum L.P.,  United States  District
Court for the Southern District of Florida (removed) Case No. 97-7157-CIV.  Suit
was filed  August 28,  1997 in Florida  state  court and was  removed to federal
court.  Plaintiff  moved to certify the class on September  27, 1997.  Following
limited discovery,  Sprint Spectrum L.P. opposed the motion and plaintiffs moved
to withdraw their motion to certify the class on March 11, 1998. Plaintiff moved
to amend the  complaint  on May 8, 1998  (including  withdrawal  of the original
class representative and the substitution of additional representatives),  which
motion was granted on June 15, 1998.

         The suit alleges that Sprint  Spectrum L.P. knew, or should have known,
at the time it promoted  high-minute  usage plans in July and August 1997,  that
such  promotions  would generate usage demand that would exceed  capacity of its
network,  resulting in blocked or dropped calls.  Plaintiff seeks to represent a
class of  subscribers  in four South Florida  counties who subscribed to service
between  July 1,  1997 to  December  31,  1997.  The suit  seeks a refund of the
purchase  price  of  telephone  handsets  and  all  amounts  paid  for  service,
unspecified  compensatory  and  punitive  damages,  attorneys'  fees  and  other
unspecified relief.

         Rick Cortez, et al. vs. Sprint Spectrum L.P. et al., United States 
District Court for the Southern  District of Texas,  Case No.  M-97-259 Suit was
filed in state court on  September  24,  1997 and  removed  to  federal  court. 
Plaintiff moved to remand and to amend the suit, which motions have been heard 
and are under advisement.

         The suit is against Sprint Spectrum L.P. and the salesperson who
allegedly sold plaintiff the telephone.  Plaintiff alleges that Sprint Spectrum
L.P.  began  promoting  its  service  through  various  advertisements, touting
clarity, fewer dropped calls and coverage in the Rio Grande

<PAGE>


Valley, which plaintiff alleges were false, complaining of excessive dropped and
blocked   calls.   Claims   are   based   on   common   law   fraud,   negligent
misrepresentation, breach of warranty and breach of contract. Plaintiff seeks to
represent a nationwide  class of subscribers.  Suit seeks  unspecified  damages,
pre-judgment interest, punitive damages and attorneys' fees.

         Camille U. and Joseph Chiarella v. Sprint Spectrum L.P., et al.,  Civil
District Court for the Parish of Orleans,  No. 97-19338.  Suit filed October 31,
1997.  Exceptions to plaintiff's  claims were filed and several were  sustained.
Plaintiff  filed an amended  petition.  Exceptions to the amended  petition were
filed on July 10, 1998.

         Plaintiff   alleges  that  Sprint   Spectrum   L.P.,   its  owners  and
distributors  began  promoting its service through  various  advertisements  and
direct solicitations,  touting clarity,  fewer dropped calls and coverage in the
New  Orleans,  which  plaintiff  alleges  were false,  complaining  of excessive
dropped and blocked  calls.  Plaintiff  seeks to represent a statewide  class of
subscribers.

         Sam Nacify v Sprint Spectrum L.P., United States District Court for the
Southern District of California at Los Angeles, Case No. 98-4093 CBM. Suit filed
in state court April 1, 1998 and removed to federal court.  Plaintiffs  moved to
remand, which motion is scheduled to be heard July 27, 1998.

         The suit is brought by a Cox Communications PCS, L.P. customer alleging
that he was induced to buy a handset and sign up for service  based on offers of
large numbers of included minutes for a low monthly  recurring  charge,  that he
experienced numerous dropped calls and blocked calls and that coverage is not as
represented  due to  popularity  of  promotions,  resulting in lack of capacity.
Claims made are for violation of the  California  Consumer  Legal  Remedies Act,
common law fraud and breach of contract.  Plaintiff  seeks to represent class of
customers in California.  Suit seeks restitution,  attorneys' fees,  prejudgment
interest, injunctive relief and other unspecified relief.


         Edward Ho, et al. v. Sprint  Spectrum  L.P.,  United  States  District
Court for the Southern District of California City of Los Angeles, Case No.
BC 192668. Suit was served June 22, 1998.

         The class is alleged to be those who bought  1,000 minute plans and 500
minute plans in California in the fall of 1997.  The suit claims that the system
did not work as  represented  (frequent  dropped  calls,  non-functioning  voice
mail). Breach of implied warranty,  common law and the California Consumer Legal
Remedies  Act fraud and  negligent  misrepresentation  claims  are made.  Relief
sought  is  injunctive,   unspecified  compensatory  and  punitive  damages  and
attorneys' fees.


Item 2.  Changes in Securities

         There were no reportable events during the quarter ended June 30, 1998.

Item 3.  Defaults On Senior Securities

         There were no reportable events during the quarter ended June 30, 1998.



<PAGE>


Item 4.  Submission of Matters to Votes of Security Holders

         There were no reportable events during the quarter ended June 30, 1998.

Item 5.  Other Information

         There were no reportable events during the quarter ended June 30, 1998.

Item 6.  Exhibits and Reports on Form 8-K

      (a) The following exhibits are filed as part of this report:

      3.1    Certificate of Limited Partnership of Sprint Spectrum L.P. 
             (incorporated by reference to Form S-1 Registration Statement,
             Registration No. 333-06609, filed on June 21, 1996).

      3.2    Amended and Restated  Agreement of Limited  Partnership of MajorCo,
             L.P. (renamed Sprint Spectrum Holding Company,  L.P.) dated January
             31, 1996, among Sprint Spectrum L.P.  (renamed Sprint  Enterprises,
             L.P.), TCI Network Services,  Comcast Telephony  Services,  and Cox
             Telephony  Partnership  (incorporated  by  reference  to  Form  S-1
             Registration Statement,  Registration No. 333-06609,  filed on June
             21, 1996).

      3.3    Agreement  of Limited  Partnership  of MajorCo Sub,  L.P.  (renamed
             Sprint Spectrum L.P.),  dated as of March 28, 1995,  among MajorCo,
             L.P.  and  MinorCo,  L.P.  (incorporated  by  reference to Form S-1
             Registration Statement,  Registration No. 333-06609,  filed on June
             21, 1996).

      4.1    Senior  Note  Indenture,  dated  August 23,  1996,  between  Sprint
             Spectrum L.P., Sprint Spectrum Finance Corporation, and The Bank of
             New York, as Trustee (incorporated by reference to Form 10-Q, filed
             on November 12, 1996).

      4.2    Form of Senior Note (included in Exhibit 4.1).

      4.3    Senior  Discount  Note  Indenture,  dated August 23, 1996,  between
             Sprint Spectrum L.P., Sprint Spectrum Finance Corporation,  and The
             Bank of New York,  as Trustee  (incorporated  by  reference to Form
             10-Q, filed on November 12, 1996).

      4.4    Form of Senior Discount Note (included in Exhibit 4.3).

      10.1   Amendment  No.  2  dated  May  8,  1998  to  Amended  and  Restated
             Procurement  and Services  Contract dated October 9, 1996,  between
             Lucent  Technologies  Inc. and Sprint Spectrum  Equipment  Company,
             L.P. as amended by Amendment  No. 1 dated  February  27, 1997.  The
             omitted  portions  indicated by brackets have been separately filed
             with the Securities and Exchange  Commission  pursuant to a request
             for  confidential  treatment under Rule 24b-2 of the Securities and
             Exchange Act of 1934, as amended.


<PAGE>



      10.2   Revised Amendment No. 1., dated June 22, 1998, to the Sprint 
             Spectrum L.P. 1997 Long-Term Incentive Compensation Plan.


     27   Financial data schedule

     (b)  Reports on Form 8-K
         A report on Form 8-K concerning the  restructuring  of the  partnership
         interests in Sprint Spectrum Holding Company, L.P. was filed on June 4,
         1998


<PAGE>


                                    SIGNATURE





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 thereunto duly authorized.







                                    SPRINT SPECTRUM L.P.
                                    (Registrant)





                                    By   /s/Robert M. Neumeister, Jr.
                                         Robert M. Neumeister, Jr.
                                         Chief Financial Officer



Dated:  August 12, 1998


<PAGE>


                                    SIGNATURE





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 thereunto duly authorized.





                                    SPRINT SPECTRUM FINANCE CORPORATION
                                    (Registrant)




                                    By   /s/Robert M. Neumeister, Jr.
                                         Robert M. Neumeister, Jr.
                                         Vice President and Treasurer




Dated:  August 12, 1998