Fourth Quarter Results

Revenue increased 42.6% to $63.8 million for the three months ended December 31, 2010, compared to $44.7 million during the three months ended December 31, 2009. The increase in fourth quarter 2010 revenue was primarily related to the inclusion of $16.1 million of Tinet's revenue in our results, as well as an increase in the number of minutes carried over our network as compared to the fourth quarter of 2009.

Billed minutes increased 25.3% to 29.9 billion minutes for the three months ended December 31, 2010, compared to 23.8 billion minutes for the three months ended December 31, 2009.

Network and facilities expenses for the three months ended December 31, 2010 were $24.1 million, compared to $13.7 million for the three months ended December 31, 2009. This increase was largely due to an increase in our network capacity expenses to accommodate greater traffic volumes as well as the inclusion of $7.3 million related to Tinet's network and facilities expenses. Combined operating expenses consisting of Operations, Sales and Marketing, and General and Administrative expenses were $19.4 million for the three months ended December 31, 2010, compared to $11.0 million for the three months ended December 31, 2009. The increase primarily resulted from the inclusion of $5.3 million of Tinet's operating expenses in our results for the fourth quarter, higher employee expenses, including additional headcount, and increased professional expenses related to the Tinet acquisition. Depreciation and amortization expense was $6.8 million for the three months ended December 31, 2010, compared to $3.8 million for the three months ended December 31, 2009. This increase was primarily a result of the inclusion of $2.4 million of Tinet's depreciation and amortization expenses in our results for the fourth quarter and adding equipment to our switch locations.

Income from operations for the three months ended December 31, 2010 was $13.5 million, or 21.1% of revenue, compared to $16.2 million for the three months ended December 31, 2009, or 36.2% of revenue.

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