Qwest lost 195,000 home landline users to cable and mobile operators in the first quarter--some 2.6 percent of its residential customer base--on its way to posting a 35 percent drop in profits, the company reported today. Net income was $157 million, or 9 cents a share, down from $240 million, or 12 cents, a year ago. Sales fell 1.4 percent to $3.4 billion.
Qwest CFO John Richardson told analysts today he expects 2008 revenue to be flat to slightly down from a year ago. CEO Edward Mueller, meanwhile, said he sees room for price hikes for core services.
Qwest provides local service to customers in 14 states. Its stock has fallen 24 percent this year. Qwest lost 783,000 landline customers last year, a drop of more than 9 percent. In an effort to recoup some revenues from fleeing landline customers Qwest yesterday announced it was dropping Sprint as its wireless provider and switching to Verizon. It had resold Sprint service since 2004 and will switch over some 860,000 wireless users who generated $129 million in revenue for Qwest in the first quarter, down 3 percent from a year ago.
For more:
- Check out Qwest's earnings report
- And the Wall Street Journal story