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Table of Contents
FORWARD-LOOKING STATEMENTS
Certain statements in this Annual Report on Form 10-K are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995,
Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. The words "estimate," "plan," "intend," "expect," "anticipate,"
"believe" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are found at various places throughout
this report. EarthLink Holdings Corp. disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. Although EarthLink Holdings Corp. believes that its expectations are based on reasonable assumptions, it can give no
assurance that its targets and goals will be achieved. Important factors that could cause actual results to differ from estimates or projections contained in the
forward-looking statements are described under "Risk Factors" in Item 1A of Part I and under "Safe Harbor Statement" in Item 7 of Part II.
PART I
Item 1. Business.
Overview
EarthLink Holdings Corp. (“EarthLink” or the “Company”), together with our consolidated subsidiaries, is a leading managed network, security and cloud services
provider to business and residential customers in the United States. We provide a broad range of data, voice and managed network services to retail and wholesale
business customers. We also provide nationwide Internet access and related value-added services to residential customers. We operate an extensive network
including more than 29,000 route miles of fiber and 90 metro fiber rings that provide data and voice IP service coverage across more than 90 percent of the United
States.
Our corporate offices are located at 1170 Peachtree Street NE, Suite 900, Atlanta, Georgia 30309, and our telephone number at that location is (404) 815-0770. Our
website address is www.earthlink.net.
History
We were incorporated in 2013 as a Delaware corporation through the creation of a holding company structure. We began operations in 1994 as a provider of
nationwide Internet access and related value-added services to residential customers. In 1996, we first expanded into the small to mid-sized business market by
introducing business-class Internet access and web hosting services to businesses nationwide. In 2006, we expanded into the enterprise business market by
acquiring a provider of managed IP-based network solutions to businesses nationwide. As the market for consumer Internet access began to mature, we began to
manage this business for cash and seek growth opportunities. During 2010 through 2013, we acquired eight companies which transformed our business from being
primarily an Internet services provider to residential customers into a network, communications and IT services provider for business customers. During that time
we were focused on integrating our acquired businesses and managing a broad portfolio of products and services. During 2014 and 2015, we established a more
focused strategy for our company and stabilized and simplified our business in order to position our company for growth and transform into a leading managed
network, security and cloud services provider. In February 2016, we sold certain assets associated with our IT services product offerings in connection with our
strategy to simplify our operations and provide more flexibility to invest in new capabilities and services to drive growth in our core business.
Business Strategy
Our business strategy is to be a leading managed network, security and cloud services provider for multi-location retail and service businesses. We believe there is
a significant market opportunity for managed network, security and cloud services due to the changing technological and business landscape, which is experiencing
increased demand for data, evolving security threats, a shift towards more software based solutions, increased use of outsourcing and tightening budgets. We are
positioning our company to focus on this opportunity. The key elements of our business strategy and transformation are as follows:
• Operate each of our business units with focused, value-optimizing strategies. During 2015, we aligned our organization around four distinct business
units, which are Enterprise/Mid-Market, Small Business, Carrier/Transport and Consumer. We believe this concentrates our resources and investments
into areas that will drive growth and deliver improved performance, enable each business to compete more successfully in the market and provide
strategic optionality. We are focused on operating each business unit with value-optimizing strategies, which are managing the decline in our Small
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