Warwick Valley Telephone, which now refers to itself as WVT Communications (Nasdaq: WWVY), reported on Friday that its Q2 earnings rose 19 percent year-over-year due to ongoing sales of cloud and unified communications (UC) services.
The Warwick, N.Y.-based telco's revenues for the three-month period ended June 30 were $6.9 million, up from $5.8 million in the same period last year.
It attributes the more than $1 million rise in revenue to the consolidation of financial results from its $17 million acquisition of Alteva in 2011 and organic UC services revenue growth.
Like other telcos, however, these results were slightly offset by ongoing declines in its telephone segment revenues. The telephone segment contributed 53 percent of the company's revenues, down from 79 percent in Q2 2011 and 54 percent in Q2 2012. Telephone services revenues, net of eliminations, were $3.6 million in Q2 2012, down from $4.6 million in the same period a year ago.
Cloud and UC are two service sets that are helping transform the once mainly rural-based telephone company that provided little more than voice services into a strategic business services player.
The telco reported that cloud and UC services revenues, net of eliminations, were $3.3 million in Q2, up 169 percent from $1.2 million from Q2 2011. WVT said its UC segment contributed $3.3 million in Q2 2012, and 47 percent of revenues in the second quarter up from 21 percent in the same period last year and 46 percent in Q1 2012.
"As we move through the halfway mark of 2012, we are making solid progress with investments to build out our platform for sustainable long term growth," said Duane W. Albro, CEO, in the earnings release. "This follows last year's pinnacle achievement of acquiring and integrating Alteva to accelerate our Cloud Communications strategy."
WVT may be a relative newcomer in the broader UC and cloud market segments, having bought its way into these markets through its acquisitions of both Alteva and USA Datanet, but it is becoming a competitive threat. Frost and Sullivan named the telco as the ninth largest hosted IP telephony and UC services provider in North America.
Shares of WVT Communications were trading at $13.85 on the Nasdaq yesterday in late afternoon trading.
- see the release
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