EarthLink added 31,000 net subscribers during the second quarter and ended the quarter with 5.3 million paying subscribers, an increase of 296,000 subscribers, or 5.9 percent, from a year ago. During the quarter, EarthLink added 47,000 net broadband subscribers and ended the quarter with 1.2 million broadband customers, an increase of 21.5 percent from a year ago. In the second quarter, the company also added 102,000 net subscribers through PeoplePC Online, EarthLink’s value-priced narrowband service, while it lost 113,000 net subscribers in its more mature premium narrowband service. The company ended the quarter with 4.0 million total narrowband subscribers, an increase of 2.4 percent from the second quarter of 2003. Total narrowband subscribers included 625,000 PeoplePC Online subscribers as of June 30, 2004, compared to 197,000 subscribers as of June 30, 2003.
Monthly subscriber churn was 4.4 percent in the quarter, an increase from 3.9 percent in the second quarter of 2003, but declining slightly from the prior quarter. The higher churn rate was primarily due to the continued migration of premium narrowband subscribers to broadband access services, including those of competing providers, and the effect of early life churn associated with the higher level of gross subscriber additions.
Looking ahead, EarthLink expects to add 50,000 to 100,000 subscribers in Q3, driven by continued growth in broadband and value-priced narrowband offerings, partially offset by a decline in premium narrowband subscribers. http://www.earthlink.net
