Fresh off of closing its acquisition of Level 3 Communications last week, CenturyLink posted weak third quarter earnings Wednesday.  

Net income for the period dropped to $92 million, down 39 percent from $152 million a year ago. Overall revenues were down 8 percent year-over-year, falling to $4.03 billion in the third quarter versus $4.38 billion in the same period last year.

Strategic revenues were down 7 percent to $1.8 billion, legacy revenues dropped 10 percent to $1.7 billion, and data integration revenues decreased 18 percent to $134 million.  

On a Wednesday earnings call CenturyLink CEO Glen Post attributed the worse-than-expected third quarter results primarily to weak growth in enterprise revenues, which were down 11.2 percent to $2.17 billion. That figure came in about $65 million below CenturyLink’s internal expectations, mainly due to a miss of approximately $35 million in customer premise equipment revenue, according to Post. Consumer revenues, meanwhile, were down 5.8 percent year-over-year to $1.39 billion.

“We also generated about $20 million less growth in high-bandwidth data services than anticipated, approximately two-thirds of which was driven by contract renewals, pricing pressure with the remainder due to lower sales and installs than anticipated,” Post said.

CenturyLink ended the period with about 5.76 million broadband subscribers, compared to 5.95 million a year ago.

When it comes to the consumer broadband segment, Post said CenturyLink is focused on attracting higher lifetime value customers with higher average revenue per customer through the company’s Price for Life offers, which it introduced in September.  

CenturyLink saw much higher-than-expected loss of customers opting for internet speeds of 20 Mbps and below, Post noted, which he blamed in part on cable companies rolling out more aggressive offers.

The company intends to continue to invest in higher speeds and will lay down fiber “where it makes sense,” Post said. 

By early 2020, in CenturyLink’s top 25 markets, the company expects to have more than 90 percent of homes passed with 40 Mbps or higher service, more than 70 percent of homes and business passed with 100 Mbps speeds, and more than 20 percent with service offering 1 Gbps speeds, according to Post.

 In a statement regarding the third quarter earnings Post focused on the recent Level 3 deal and future potential.

"We're excited to have completed the Level 3 acquisition last week. We believe this combination creates one of the world's most powerful networks. Together, we have a compelling set of assets, the scale to compete globally and the opportunity to drive significant operational efficiencies," Post said.

“Although below our expectations, CenturyLink's third quarter 2017 high bandwidth services revenue increased more than five percent on a normalized basis year-over-year,” he added. “This, together with Level 3's performance, reflects the continuing growth in demand for bandwidth and supports our belief that our increased scale and reach creates even greater potential for us to win in the marketplace. In addition, our commitment to enable market-leading customer experience and drive efficiencies into our business gives us great opportunity to grow adjusted EBITDA and free cash flow."

CenturyLink COO Jeff Storey told investors that the company has achieved “several milestones” in the seven days since closing the $34 billion Level 3 deal. Storey said the companies’ networks have been interconnected and now integration efforts are underway. Management organization has also been defined and budget targets are set for 2018.

“There’s a lot of work to do, but have an excellent integration plan in place,” Storey said.

CenturyLink says it remains confident it can achieve nearly $1 billion in forward run rate operating capital cash synergies.