CenturyLink Profit Up for Q4, Full Year 2015

Business segment revenues were $2.66 billion, a decrease of 1.6 percent from fourth quarter 2014.

Edward Gately, Senior News Editor

February 10, 2016

3 Min Read
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CenturyLink today reported a nearly 80 percent increase in net income for its fourth quarter compared to the same quarter in 2014, along with higher-than-estimated operating revenue.

Total operating revenue in the fourth quarter was $4.47 billion compared to $4.44 billion for the year ago quarter. Net income was $338 million compared to $188 million.

For the full year, operating revenue fell to $17.9 billion from $18 billion in 2014. Net income totaled $878 million compared to $772 million.

“CenturyLink achieved strong fourth-quarter financial results as revenues, cash flow and adjusted diluted earnings per share exceeded the top end of our guidance for the quarter, driven by solid revenue performance and lower operating costs,” said Glen F. Post III, CenturyLink’s CEO and president. “Our consumer segment continued to perform well as revenues grew both sequentially and year-over-year, while business segment revenues grew sequentially on stronger core revenue generation. Our employees did a great job of containing costs during the second half of the year, which helped us exceed our goal of planned operating expense reductions for the second half of 2015.”

Business segment revenues were $2.66 billion in the fourth quarter, a 1.6 percent decrease from the same quarter in 2014, due primarily to declines in low-bandwidth data services and legacy revenues which were partially offset by growth in high-bandwidth data services revenues.

Consumer segment revenues were $1.51 billion for fourth quarter, a 1.3 percent increase from fourth quarter 2014.

Fourth quarter revenue from high-bandwidth data services provided to business customers, including MPLS and Ethernet, increased about 9 percent year over year, while revenue from consumer strategic services grew more than 6 percent year over year.{ad}

CenturyLink added about 16,000 Prism TV customers during the quarter, ending the period with about 285,000 customers. It also ended the quarter with about 6 million high-speed Internet customers, a decrease of about 22,000 customers.

The increase in fourth-quarter operating revenue was driven by the increase in high-cost support revenues due to the recognition of Connect America Fund Phase 2 (CAF Phase 2) support during the quarter, along with strength in high-bandwidth data services and consumer strategic revenues. The increases were partially offset by declines in low-bandwidth data services and legacy revenues, which was primarily driven by access line losses and lower long-distance revenues.

“As we look to 2016, we are seeing strong demand for high-bandwidth data and managed services from businesses, which we expect to help mitigate the anticipated further declines in our legacy revenues,” Post said. “Our IT services business, while relatively small today, continued to grow and gain traction during 2015, generating revenues that more than doubled compared to the prior year. We also have a solid funnel of business services opportunities going into 2016, which we expect to help drive network and managed services revenue.”

Also today, CenturyLink announced that Dean Douglas will join the company as president of sales and marketing, and Bill Hurley has been named chief marketing officer. Douglas most recently served as CEO of Unify GmbH & Co., and Hurley served as Unify’s chief marketing officer.

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About the Author(s)

Edward Gately

Senior News Editor, Channel Futures

As news editor, Edward Gately covers cybersecurity, new channel programs and program changes, M&A and other IT channel trends. Prior to Informa, he spent 26 years as a newspaper journalist in Texas, Louisiana and Arizona.

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