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CenturyLink's Second Quarter Earnings Report
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CTL
CenturyLink (NYSE:CTL) announced its results for the most recent quarter on August 8, 2012. CenturyLink is a communications company that offers communications services, including Internet access, broadband services, and voice services.
In most situations, when earnings do not meet analyst estimates, a business' stock price will tend to drop. On the other hand, when actual earnings beat estimates by a significant amount, the share price will likely surge. SEE: 5 Tricks Companies Use During Earnings Season
The Numbers: CenturyLink's EPS outpaced analyst estimates while the company's revenues came in line with predictions. The company reported adjusted net income of 65 cents per share versus the 61 cents per share estimate and revenues of $4.61 billion versus the $4.61 billion estimate. Revenue climbed 4.7% from the same period last year. CenturyLink's revenue has grown during each of the past four quarters on a year-over-year basis. The company's net income for the quarter fell 35.7% to $74 million.
Management Quote: "CenturyLink continued to generate solid results in the second quarter, maintaining our top-line revenue trend improvement and strong cash flow generation," said Glen F. Post, III, chief executive officer and president. "We successfully completed our operating group restructuring during the second quarter without disrupting the positive sales momentum across our business and believe that CenturyLink is even better positioned to serve our enterprise customers across the United States and internationally."
A Look Back: Last quarter was the fifth in a row that the company saw shrinking gross margins, as they fell one percentage points from the year-earlier quarter to 58.5%. In that span, margins have contracted an average of 5.9 percentage points per quarter on a year-over-year basis.
Looking Ahead: Analysts have a positive outlook for the company's performance next quarter. Over the past seven days, the average estimate for the third quarter has gone up to 60 cents a share from 59 cents. Increasing earnings estimate is a positive sign about the company and it typically leads a increase in the stock price. For the fiscal year, the average estimate has moved up from $2.40 a share to $2.47 over the last ninety days.
In most situations, when earnings do not meet analyst estimates, a business' stock price will tend to drop. On the other hand, when actual earnings beat estimates by a significant amount, the share price will likely surge. SEE: 5 Tricks Companies Use During Earnings Season
The Numbers: CenturyLink's EPS outpaced analyst estimates while the company's revenues came in line with predictions. The company reported adjusted net income of 65 cents per share versus the 61 cents per share estimate and revenues of $4.61 billion versus the $4.61 billion estimate. Revenue climbed 4.7% from the same period last year. CenturyLink's revenue has grown during each of the past four quarters on a year-over-year basis. The company's net income for the quarter fell 35.7% to $74 million.
Management Quote: "CenturyLink continued to generate solid results in the second quarter, maintaining our top-line revenue trend improvement and strong cash flow generation," said Glen F. Post, III, chief executive officer and president. "We successfully completed our operating group restructuring during the second quarter without disrupting the positive sales momentum across our business and believe that CenturyLink is even better positioned to serve our enterprise customers across the United States and internationally."
A Look Back: Last quarter was the fifth in a row that the company saw shrinking gross margins, as they fell one percentage points from the year-earlier quarter to 58.5%. In that span, margins have contracted an average of 5.9 percentage points per quarter on a year-over-year basis.
Looking Ahead: Analysts have a positive outlook for the company's performance next quarter. Over the past seven days, the average estimate for the third quarter has gone up to 60 cents a share from 59 cents. Increasing earnings estimate is a positive sign about the company and it typically leads a increase in the stock price. For the fiscal year, the average estimate has moved up from $2.40 a share to $2.47 over the last ninety days.
by
Investopedia Staff
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