Updated from 7:39 a.m.
posted a second-quarter loss Tuesday, as legal costs and job cuts pressured the bottom line. Its shares fell 9%.
For its second quarter ended June 30, the Denver telco lost $776 million, or 43 cents a share. That's wider than the year-ago loss of $61 million, or 4 cents a share. Revenue slipped 4.3% to $3.44 billion.
The latest quarter included charges of $487 million, or 27 cents a share. Those charges included $127 million on job cuts -- the company said it has slashed 1,550 jobs this year -- and $300 million to boost legal reserves associated with "certain investigations and securities actions." Qwest remains under investigation by the
Securities and Exchange Commission
and Justice Department over previous management's aggressive business and accounting practices.
The latest-quarter results missed Wall Street's targets. A Thomson First Call analyst consensus estimate called for a 13-cent loss on revenue of $3.51 billion.
Qwest said it lost local access lines at a 4% clip in the latest period. The company added 733,000 long-distance lines, but it also determined that the number of previously reported long-distance lines in the fourth quarter of 2003 was overstated by approximately 133,000 lines. Accordingly, the total line count as of the fourth quarter of 2003 and the first quarter of 2004 have been adjusted to 2.2 million and 3.4 million, respectively.
The company added 109,000 subscribers to its digital subscriber line, or DSL, fast Internet access service in the second quarter to end with 853,000 DSL subscribers.
"We continued to make significant progress on our key objectives, which will drive growth and increase our financial flexibility," said CEO Richard C. Notebaert. "While our momentum was somewhat impacted by seasonality and some competitive pressures, especially in our enterprise business, we were pleased with the continuing strength across our key growth services."
Qwest dropped 35 cents early Tuesday to $3.62.