KANSAS CITY, Mo. (AP) – Embarq Corp., the nation's fourth-largest traditional telephone company, said Wednesday its first-quarter profit fell 18 percent as business customers dropped service and the company lost money on the sale of its logistics unit.
The Overland Park, Kan.-based company reported earning $174 million, or $1.21 per share, during the quarter, compared with earning $212 million, or $1.37 per share, during the same period a year ago.
Not including a $26 million loss on the sale of Embarq Logistics to KGP Telecommunications Inc., Embarq said it would have earned $1.39, above the $1.29 expected by analysts surveyed by Thomson Reuters.
Revenue during the quarter fell 7.5 percent, from $1.46 billion to $1.35 billion, just below analysts' expectations of $1.36 billion.
The company said it lost 144,000 access lines during the quarter to end at 5.55 million in 18 states. By contrast, Embarq lost 120,000 lines a year ago.
Almost all the latest loss came from business customers ending service because of the economy, while Embarq's consumer service stayed relatively flat for the first time since the fourth quarter of 2007.
The company said it added 40,000 high-speed Internet subscribers, or 67 percent more than the previous three quarters. It also added 13,000 video customers.
Embarq is being acquired by Monroe, La.-based telecommunications provider CenturyTel Inc. Already approved by both companies' shareholders, the deal is pending approval from the Federal Communications Commission and five of the 33 states in which the two companies do business.