Earthlink 2010 Annual Report Download - page 135
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127
(1)
On December 8, 2010, we acquired ITC^DeltaCom. The results of operations of ITC^DeltaCom have been included in the
Company's consolidated financial statements since the acquisition date.
(2)
During the year ended December 31, 2010, the Company reclassified depreciation expense from cost of revenues to
operating costs and expenses. Certain amounts in the prior year financial statements have been reclassified to conform to
the current year presentation.
(3) Operating costs and expenses for the quarter ended December 31, 2009 includes a non-
cash impairment charges of
$24.1 million related to goodwill and certain intangible assets of New Edge in the Company's Business Services segment.
EarthLink concluded the carrying value of these assets were impaired in conjunction with its annual test of goodwill and
intangible assets deemed to have indefinite lives. Operating costs and expenses for the quarter ended December 31, 2010
includes a $1.7 million impairment to write off the Company's New Edge trade name, as a result of a decision to re-
brand
the New Edge name as EarthLink Business.
(4)
During the quarter ended December 31, 2009, EarthLink recorded an income tax benefit in the Statement of Operations of
$198.8 million as a result of a release of its valuation allowance related to deferred tax assets. These deferred tax assets
related primarily to net operating loss carryforwards which the Company determined it will more likely than not be able to
utilize due to the generation of sufficient taxable income in the future.
(5)
The quarterly net income per share amounts will not necessarily add to the net income per share computed for the year
because of the method used in calculating per share data.