No Word Yet From Earthlink On Plans For Muni Wi-Fi, Helio

Earthlink (ELNK) Tuesday announced that it will cut 900 jobs as part of a corporate restructuring plan. Recently installed CEO Rolla Huff had previously promised that an overhaul of the company was coming; the Street has been speculating that the company might sever or sell its investment in the cellular operator Helio, or get out of the money losing muni Wi-Fi business.

So far, the company appears to have done neither of those things. The company says it will close offices in Orlando, Knoxville, San Francisco and Harrisburg, Pennsylvania, and reduce staff in Pasadena, California, and in its headquarters in Atlanta.

The company said it will record restructuring costs of $60 million to $70 million for the restructuring in the third and fourth quarters. The company said it expects the cuts to save $25 million to $35 million a year in costs through the remainder of 2007.

The company also adjusted its financial guidance. For the third quarter, the company now sees revenue of $290 million to $300 million, with adjusted EBITDA of $30 million to $35 million, and a loss of $33 million to $43 million.

For the full year, the company sees revenue of $1.19 billion to $1.21 billion, adjusted EBITDA of $135 million to $145 million and a net loss of $79 million to $109 million. Previously, the company had forecast revenue of $1.225 billion to $1.240 billion, with adjusted EBITDA of $108.0 million to $118.0 million and a loss of $110 million to $140 million for the year.

Earthlink also said it expects industry wide gross subscriber additions to decelerate in 2008, resulting in “fewer gross subscriber additions for Earthlink as it will no longer add new subscribers that do not yield a positive lifetime value for our shareholders.”

Finally, the company also said it will boost its share repurchase program by $200 million, which increases the current authorization to $270 million.

And one more thing: Earthlink said it expects to announce additional steps in the coming weeks and months. Don’t be surprised if they eventually figure out a way to extract themselves from the money losing Helio and wi-fi operations.