Level 3 Communications Inc. reported a wider fourth quarter net loss today as it plowed toward a future in broadband network services while its DSL and modem customers continued to decline in number.
For the quarter ending Dec. 31, the communications network provider had a net loss of $169 million, or 24 cents a share, which reflected a $3 million loss on the acquisition of WilTel Communications Group in Tulsa, Okla., and a $49 million gain on the sale of its (i)Structure unit.
In the previous fourth quarter, Level 3 reported a net loss of $77 million, or 11 cents a share.
Revenue was $944 million, down from $1.04 billion in the previous fourth quarter.
Analysts surveyed by Thomson Financial expected a loss of 29 cents per share on $918 million in sales.
For the year, Level 3 reported a net loss equivalent to 91 cents a share compared with a net loss of 67 cents a share in 2004.
While customers of the DSL and managed modem businesses continued to diminish, Level 3 executives said they were pleased with demand for transport and Internet-related services.
“Given current growth rates in transport, IP and wholesale voice, together with the growth we expect from continuing pricing improvements and growth from subscriber-oriented voice-over-IP, we believe we cannot only manage debt but create real value,” Chief Executive Officer James Crowe told analysts.
Level 3’s results indicated progress but its Voice Over Internet Protocol service has yet to take off, telecommunications analyst Donna Jaegers of Janco Partners said.
“I think they’re going to squeak through OK but they still have to show these other businesses are going to ramp,” she said.
Level 3’s stock closed down 13 cents, or 3.6 percent, to $3.51 a share on the Nasdaq Stock Market.
Based in suburban Broomfield, Level 3 has a 23,000-mile broadband fiber optic network, providing wholesale Internet dial-up service and Internet connectivity for broadband subscribers.
