EarthLink's financials are hurting due in part to metro wireless delays: They can't start making money from municipal wireless until they actually have the networks built and running. The firm posted revenue of over $330m and a loss of $3.2m. Over $26m in expense was attributed to Helio, their joint venture mobile virtual network operator (MVNO) with SK Telecom. Dial-up subscription fell less precipitously, dropping by 81,000 subscribers, leaving 3.3m remaining with revenue of $150m. Broadband accounts increased modestly by 47,000 customers.
The AP reports that the company's CEO Gary Betty told analysts about EarthLink's Wi-Fi ventures, "We've had every imaginable delay you can think of" from getting city councils to announce deals on time to getting permits and building towers. The delays will not impact cost estimates for the projects, he said. EarthLink expects a loss next quarter as well.
According to filings dating to June 30, EarthLink has over $200m in cash on hand and no debt. They spent nearly $60m repurchasing stock this last quarter, which is often the case when companies believe their stock is historically undervalued. This allows them to increase existing stockholders' equity without issuing a dividend, and makes it possible for them to sell additional stock later when they believe conditions are favorable, essentially making a kind of profit.