Cbeyond Makes Money in Slow IT Transformation

By Craig Galbraith Comments
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**Editor's Note: Click here for a look back at how some of the industry's biggest players fared in Q2.**

Atlanta-based Cbeyond, the CLEC that's morphing into a seller of IT services, has reported a $2 million profit in the third quarter of 2012. That was up from a net loss of $1.1 million in the year-ago quarter, but down from $2.7 million in the black in Q2 2012.

The company's earnings statement, released Monday afternoon, says total revenue for Q3 was $121.5 million, down just slightly from Q3 2011 and the second quarter of this year.

Cbeyond "2.0" – the company's new strategy focused on cloud and other technologies – comprised 7.8 percent of revenues in the third quarter, up from 6.5 percent in Q2. So it's a slow transition for a company with roots in business VoIP.

"I'm pleased with Cbeyond's progress in its strategic evolution and believe that the third quarter marks an important point in our path for several reasons," said Jim Geiger, chief executive officer of Cbeyond.

Among those reasons, Geiger noted, were the launch of two new products: Total Cloud Data Center – a secure, enterprise class, customizable set of managed services – and Total Cloud Phone System, an advanced version of Cbeyond's hosted PBX offering.

Also in Q3, Cbeyond lit dark fiber in its first batch of 35 buildings, Geiger said, with many more on the way. In addition, "most of our new 2.0 sales force is now in place and beginning to be productive. The combination of these three events represents a powerful platform for our future growth, and we look forward to developing the opportunities they afford us," he added.

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