With Level 3 In the Wings, tw telecom Posts Solid Q2 Growth

A week or so earlier than usual and a day and a half after its prospective acquirer did so, tw telecom posted its second quarter results.  They saw revenue growth pick up a little bit over the past few quarters, moving up 2.8% sequentially and beating estimates slightly.  Earnings per share seems to have been inline after excluding merger-related costs.  Here are their numbers in some context:

Margins remained lower than they have been historically, which is not at all unexpected due to all the market expansion work the company has been doing for the past 8 months.  Capex ticked back down below the $100M mark for the quarter, the first time we’ve seen that in a while with or without the market expansion projects.  But tw telecom kept up its on-net building pace, adding 554 more during the quarter. and breaking the 21K mark.

With the Level 3 deal set to close in Q4 and I suspect possibly in October, this very well may be the last earnings report we get from tw telecom before the closing of the deal.  For almost a decade we’ve almost been able to set our watches by tw telecom’s numbers and performance, as they usually chose focus and discipline over the more free-wheeling consolidation on the other side of the fence.

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