NorthPoint Communications (Nasdaq: NPNT) shares fell Monday as the company revised previously announced third quarter results on account of customers not paying their bills.
Shares of the digital subscriber line (DSL) services provider were off 10 percent, down 0.44 to 3.69.
The financial results for the third quarter, originally released Oct. 26, were cut when NorthPoint subsequently determined that certain privately-held network service providers did not have the cash to make their payments to NorthPoint.
The shortfall of NorthPoint's customer's has been a familiar story in the DSL sector, with companies like Copper Mountain (Nasdaq: CMTN) and Covad (Nasdaq: COVD) also suffering from a sector slowdown.
For the third quarter, NorthPoint will now report revenue of $24 million compared to the $30 million reported earlier, with the drop attributed to lost sales revenue and increased operating expenses relating to the troubled accounts. NorthPoint will include the outstanding revenue when all previous account receivables with these customers are paid up and cash is received for new services.
Loss for the quarter, before interest, taxes, depreciation and amortization (EBITDA), increased to $90.9 million, compared to the $79.2 million previously reported.
The installed lines associated with the delinquent ISP accounts are about 26,700 and NorthPoint has halted installation on jobs in progress. The company is also currently attempting to switch over lines of delinquent accounts to customers in good financial standing.
NorthPoint made news back in August by inking an ISP deal with Verizon Communications (NYSE: VZ).