Another ISP misses annual-report deadline
Covad fails to submit on time because of what it calls "complex accounting issues" related to revenues, restructuring costs and customer financial strains.
The high-speed Internet services provider said Tuesday that it expects a "significantly higher loss" in 2000, compared with 1999, because of large investments in infrastructure and acquisition activity. Covad also said it plans to report higher revenue.
In notifying the Securities and Exchange Commission that it would be late in filing the annual report, the Santa Clara, Calif.-based company said it is working diligently to submit the information "as soon as practicable."
Covad's problems speak to a wider struggle among ISPs, a number of which have found themselves in hard times. Also on Tuesday, PSINet said it has been forced to delay filing its annual report for 2000 to federal regulators and might file for bankruptcy.
Covad's delay is the latest sign that the company is struggling to find fast-track profitability in the slowing economy. In February, it postponed the release of its 2000 results to review accounting concerns and internal procedures. Last year, the company said it would cut 13 percent of its work force, or some 400 employees.
In order to report correct revenues for 2000, Covad said it is reviewing its service provider contract billings and credits for current and prior periods to insure that it is properly recognizing revenue.
During morning trading Wednesday, the company's stock was down 6 cents, or about 6 percent, to 97 cents. The stock is down considerably from its 52-week high of $49 a share.