CenturyLink's CEO Glen Post addressed the elephant in the room right away during the company's second quarter 2017 earnings call on Wednesday evening: pending litigation.
Last month CenturyLink was accused of conducting unfair and fraudulent billing practices when a former employee filed a wrongful termination lawsuit after being fired. The following week, a class-action suit was filed against CenturyLink seeking damages as high as $12 billion for its consumer customers.
"I want to be very clear, the allegations contained in the lawsuits are contrary to everything I believe we stand for, and does not represent our principles [or] our values," Post said.
CenturyLink's 25-year CEO said that the carrier is taking these allegations very seriously, and stressed that it has pointed a special committee to conduct an independent investigation. Post doesn’t expect this review to wrap up until Q4.
"Sometimes we do make mistakes just like anyone else … whatever is found in the investigation of these matters, we will do the right thing," Post said.
CenturyLink announced a slew of leadership changes in June, which Post also addressed during the call. He confirmed that he still plans on stepping down in 2019, and Level 3 Communications' current president and CEO Jeff Storey will become CEO of the newly-combined company. The companies still expect the $34 billion acquisition of Level 3 to be completed by the end of September.
June proved to be a busy month CenturyLink, which revealed that the freshly-merged company will be organized into five business units, including strategic enterprise; federal government and state government; global accounts management and international; small and midsize business, and local government and education; wholesale and indirect; and consumer. Moreover, each president overseeing the new business units will be naming their leadership team, which could include a change to CenturyLink's current channel leadership lineup.
Overall, CenturyLink's Q2 financials were heavily impacted by one-time charges related to the sale of the data centers and colocation business, according to the Monroe, La.-based carrier.
Enterprise revenues declined 9 percent to $2.22 billion from $2.43 billion in the year ago quarter, which the provider attributed to revenue reduction associated with the sale of its data center assets, as well as a decline in legacy IT revenues.
The bright spot in CenturyLink's business segment was within its enterprise strategic services unit, which includes high-bandwidth data services, managed services, and SD-WAN packages. Strategic enterprise service revenues grew 5 percent year-over-year.