Revenue during the quarter dropped 3.78 percent to $4,382 million from $4,554 million in the previous year period. Gross margin for the quarter contracted 179 basis points over the previous year period to 54.45 percent. Total expenses were 86.42 percent of quarterly revenues, up from 85.60 percent for the same period last year. That has resulted in a contraction of 83 basis points in operating margin to 13.58 percent.

Operating income for the quarter was $595 million, compared with $656 million in the previous year period.

However, the adjusted operating income for the quarter stood at $603 million compared to $734 million in the prior year period. At the same time, adjusted operating margin contracted 236 basis points in the quarter to 13.76 percent from 16.12 percent in the last year period.

"The digital economy relies on broadband connectivity, and together with Level 3 we will have one of the most robust fiber network and high-speed data services companies in the world," said Glen Post, CenturyLink chief executive officer and president. "This transaction furthers our commitment to providing our customers with the network to improve their lives and strengthen their businesses. It is this focus on providing fiber connectivity that will continue to distinguish CenturyLink from our competitors. CenturyLink shareholders will benefit from the significant synergies and financial flexibility provided by the combined company’s revenue growth and strong cash flow. For employees, this combination will bring together two highly customer-focused organizations and provide employees growth and advancement opportunities the companies could not offer separately."

For the fourth-quarter 2016, CenturyLink, Inc. expects revenue to be in the range of $4,280 million to $4,340 million. On an adjusted basis, the company projects diluted earnings per share to be in the range of $0.53 to $0.59.

Cash flow from investing activities was almost stable for the quarter at $2,012 million, when compared with the previous year period. It has incurred net capital expenditure of $1,988 million on net basis during the nine month period, down 1.09 percent or $22 million from year ago period.

The company has spent $1,486 million cash to carry out financing activities during the nine month period as against cash outgo of $1,707 million in the last year period.

Cash and cash equivalents stood at $140 million as on Sep. 30, 2016, down 60.56 percent or $215 million from $355 million on Sep. 30, 2015.

Working capital remains negative
Working capital of CenturyLink, Inc. was negative $2,005 million on Sep. 30, 2016 compared with negative $2,197 million on Sep. 30, 2015. Current ratio was at 0.58 as on Sep. 30, 2016, down from 0.60 on Sep. 30, 2015.

Days sales outstanding went down to 21 days for the quarter compared with 39 days for the same period last year.

Debt comes down marginally
CenturyLink, Inc. has recorded a decline in total debt over the last one year. It stood at $19,718 million as on Sep. 30, 2016, down 3.41 percent or $696 million from $20,414 million on Sep. 30, 2015. Total debt was 42.14 percent of total assets as on Sep. 30, 2016, compared with 41.87 percent on Sep. 30, 2015. Debt to equity ratio was at 1.42 as on Sep. 30, 2016, down from 1.43 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 1.82 for the quarter from 1.99 for the same period last year.