Fusion Telecommunications (FSNN) Tops Q2 EPS by 4c, Miss on Revenues

Fusion Telecommunications (NASDAQ: FSNN) reported Q2 EPS of ($0.14), $0.04 better than the analyst estimate of ($0.18). Revenue for the quarter came in at $30 million versus the consensus estimate of $33.88 million.

• Business Services segment revenue grew 40% year over year to $30.0 million, of which over 86% was contracted and recurring. Consolidated revenue grew 23% to $38.1 million, compared to $31.0 million in Q2 2016
• Consolidated gross margin increased approximately 270 basis points to 45.1%, compared to 42.4% in Q2 2016
• Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") grew 66% to $3.7 million, compared to $2.2 million in Q2 2016 and grew 13% compared to $3.3 million in Q1 2017 (see definition and further discussion about the presentation of Adjusted EBITDA, a non-GAAP measurement, below)
• Ended the quarter with approximately 13,100 Business Services customers and approximately $13.4 million in total contract value in backlog
• Ended the quarter with an average monthly revenue per customer ("ARPU") of $751, compared to $539 at June 30, 2016 and $732 at March 31, 2017
• Ended the quarter with monthly churn of 0.9%, compared to 1.0% in Q2 2016 and 1.0% in Q1 2017
• Reduced the Company's senior debt balance by $4.6 million year to date, as the Company made scheduled principal payments and paid down its revolving credit facility during the quarter
• Announced the formation of Fusion Global Services, which will combine Fusion's Carrier Services division with XComIP, LLC, enhancing Fusion's focus on its Business Services segment and reducing operating expense, thereby improving the Company's consolidated margin profile
• Completed the implementations of a new operations support system (OSS) and unified billing platform
• Launched a new and enhanced customer portal for Fusion's leading-edge SD-WAN (Software Defined Wide Area Network) cloud network solution
• Added to the Russell Microcap Index, one of the most widely followed equity investment benchmarks for emerging growth companies

For earnings history and earnings-related data on Fusion Telecommunications (FSNN) click here.

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