Level 3 Communications Inc. on Wednesday said it swung to a
second-quarter loss on charges related to its efforts to improve
its balance sheet, halting a string of six straight quarters of
profits.
However, excluding one-time items, Level 3's per-share earnings
beat expectations.
Shares of the Broomfield, Colo., telecommunications-services
provider fell 1.8% to $51.57 in recent premarket trading, as the
company's revenue fell short of analysts' estimates.
Overall, Level 3 reported a quarterly loss of $13 million, or
four cents a share, compared with a year-earlier profit of $51
million, or 21 cents a share. Excluding debt-extinguishment and
refinancing-related losses and other items, per-share earnings were
42 cents.
Revenue climbed 27% to $2.06 billion, buoyed by its acquisition
last year of rival TW Telecom.
Analysts polled by Thomson Reuters expected a per-share profit
of 39 cents and revenue of $2.08 billion.
Companies such as Level 3 are taking advantage of rising demand
for Internet bandwidth from several sectors, including media
companies looking to distribute video over the Internet, big
corporations that are increasingly reliant on computer services
delivered over the Web and cellphone companies that are investing
in links to get traffic off the airwaves and into fiber as quickly
as possible to speed service.
The soaring demand has spurred a consolidation spree among the
carriers that own fiber-optic cables and data centers, the building
blocks of the Web.
The company has used its acquisition of TW Telecom to pursue a
wider range of business customers. Level 3 said in April that it
could still pursue other companies on an opportunistic basis.
Level 3 also affirmed its 2015 guidance for earnings before
interest, taxes, depreciation and amortization.
Write to Tess Stynes at tess.stynes@wsj.com
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