EarthLink (Nasdaq: ELNK) said Monday it will surpass its member growth estimates for the third quarter and fourth quarter, ending the year with close to 2 million members.
Shares in the Internet service provider jumped 2 3/16 to 49 1/16, or 5 percent in initial trading Monday morning.
EarthLink is expected to add 230,000 net new members in the third quarter and 370,000 in the fourth quarter, a total of 600,000 members.
"We've seen a solid increase in our member growth which is based on our successful organic growth strategy and focus on the switcher market,'' said Garry Betty, president and CEO of EarthLink in a company release.
"Last year we announced a detailed accelerated growth plan to position ourselves as the clear alternative to AOL. EarthLink has grown more rapidly than any other ISP over the last year," he added.
EarthLink's accelerated growth has been boosted by a number of major deals during the quarter, such as its distribution deal with AOL for its Instant Messenger product, and its exclusive ISP position on one million FreeMac.com computers. The company was also named as the exclusive ISP for national insurance provider USAA. EarthLink and Sprint Corp. (NYSE: FON) have also formed a broad business relationship to create an Internet service.
Last quarter, Earthlink edged above expectations.