Qwest: Shaken & Stirred, Not Shamed

Om Malik | Wednesday, May 4, 2005 | 2:03 AM PT | 1 comment

Qwest, like a jilted lover is acting like all is fine. We all know its not. They are hurting at their very public rejection by an aging diva (MCI) whose jowls have had more botox injections than entire Hollywood star corps. During the course of a conference call announcing its first quarter 2005 results, Qwest CEO Dick Notebaert, said that it will look to go national and become the third option to the national duoply of SBC (and AT&T) and Verizon (MCI.) “There are a number of opportunities in our sector, a number of companies, a number of businesses,” Notebaert said in a conference call after Tuesday’s report. Options include picking up assets of failing CLECs (mostly for their customers), and cleaning up the bits and pieces that SBC and Verizon will be forced to shed as they digest the long distance businesses. I think there is the option of merging with the local business of Sprint, which the wireless carrier will spinout once it completes the merger with Nextel. Janco Partners analyst Donna Jaegers thinks Qwest could go after Time Warner Telecom Inc. and XO Communications. Talking about results, Qwest posted a first-quarter profit of $57 million, or 3 cents per share versus a loss of$310 million, or 17 cents per share. The profits have come because the company sold off its wireless assets. Revenues were down for the quarter to $3.45 billion from $3.48 billion a year earlier. DSL lines were up, the only bright spot in what has been a lackluster few weeks for the company.

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