XO revenues fall, loss grows

XO Communications saw growth in its commercial and wholesale segments but posted a higher net loss on slightly lower revenues for the first quarter of 2006.

Adjusted EBITDA grew slightly to $22.5 million from $22.2 million in the first quarter of 2005. For the wireline business, adjusted EBITDA was $17.4 million. Revenues of $349.7 million were down from $351.2 million in the fourth quarter of 2005 and $361.5 million in the first quarter of 2005. Some of that decline represented shrinkage in what XO terms “non-core voice services” which the company is de-emphasizing.

XO saw growth in its XOptions Flex advanced data services, launched in April of 2005, closing the first quarter with 3,900 total new customers, which generated $5.3 million in first quarter revenue as compared to $3.5 million in the fourth quarter of 2005. It also expanded wholesale VoIP services portfolio during the quarter, generating $4.3 million in first quarter revenue as compared to $1.8 million in the fourth quarter of 2005. And the company’s VoIP traffic grew by 32 percent in the quarter to more than 2.9 billion minutes across nationwide IP network.

XO also launched its new broadband wireless business, Nextlink, which achieved revenue of $100,000 in the quarter, compared to $200,000 for all of 2005.

“We are very pleased with the success of our new voice over IP solutions for businesses and service providers and are excited about the enhanced capabilities of our long haul fiber network and the recent launch of Nextlink, which holds one of the largest arrays of fixed wireless spectrum assets,” said XO CEO Carl Grivner. “Operationally, we continued to make strides in reducing our costs and growing revenue from our core services and new strategic IP services.”