tw telecom's (Nasdaq: TWTC) continued focus on providing competitive business services continued to pay off in the fourth quarter of 2010 as the service provider reported $324.8 million in revenue, up $16.9 million, or 5.5 percent, from the same period last year.
For the year, the service provider reported $1.27 billion in revenue and $271.4 million in net income, a figure that includes a non-cash tax benefit of $227.3 million.
Larissa Herda, tw telecom's Chairman, CEO and President, said in a statement that "We grew our revenue, expanded our M-EBITDA margin, substantially increased net income, and generated strong cash flow, adding that "we strategically invested in the business to advance our network capabilities, deliver new product features and reach more customer locations."
As has been in the case in previous quarters, enterprise services were the star performer, where revenue was up $15.3 million over the $307.9 million for Q4 2009. This represented a $16.9 million, or 5.5 percent, year over year increase. Within the business service arena, tw telecom's data and Internet revenue grew 15.8 percent, thanks to 28.2 percent increase in both Ethernet and managed VPN services.
Wholesale carrier revenue also was up in Q4. Driven mainly by an increase in wireless backhaul revenue, tw telecom's carrier revenue increased $3 million.
There were the obvious losses, however, in voice and network services. Once again, voice services declined 1.2 percent, while network services were down 1.1 percent.
Looking forward into Q1 2011, tw telecom expects that earnings may be impacted by historical trends, including seasonal revenue fluctuations and about a $3 million sequential cost increase due to the resetting of payroll taxes and other employee-related expenses.
Regardless of these charges, the competitive provider does expect to continue its success-based capital drive. In 2011, tw telecom expects its estimated $310 to $330 million "capital investments to be tied to new sales opportunities."
- see the earnings release
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