WorldCom Reports First Quarter 2000 Results - Company Financial Information

Cambridge Telcom Report, May 1, 2000

MCI WORLDCOM, Inc. (NASDAQ:WCOM) Thursday reported strong profitability gains in first quarter 2000 driven by robust data, Internet and international revenues and declining access and technology costs. For the quarter ending March 31, 2000, earnings before goodwill amortization (cash earnings) increased 59 percent year-over-year to $1.6 billion, or $0.54 per common share. Net income increased 80 percent to $1.3 billion, or $0.44 per common share.

Revenue Growth Communications services revenues, net of voice access costs, increased 19 percent year-over-year. Including access costs paid to local exchange carriers, communications services posted revenues of $10 billion. The incremental year-over-year revenue gain of $1.3billion for the quarter represents 14 percent growth. Excluding WorldCom's interest in the Brazilian telecommunications company Embratel, communications services revenues were $9.2 billion, a year-over-year increase of 14 percent or $1.1 billion.

Data, Internet and international revenues grew 32 percent or $1.1 billion from the year-ago quarter to $4.6 billion and now account for 46 percent of WorldCom's total revenues. Capitalizing on its data and Internet services leadership, WorldCom recently announced "generation d," a major initiative to extend its network services to include five value-added services to facilitate e-commerce and e-business. They include network and access, hosting, e-business "toolkits," turn-keyweb solutions, and custom web solutions.

MANAGEMENT'S COMMENTS ON THE FIRST QUARTER RESULTS "WorldCom continues to enjoy success in its focus markets. On anannualized basis, data, Internet and international services represent more than $18 billion of annualized revenues growing at 32 percent," said Bernard J. Ebbers, president and CEO of WorldCom. "We are clearly leading the communications industry into a new era dominated by data- and Internet-based services, and our newly announced generation d initiatives leverage our existing strengths."

"Generation d will position WorldCom as a preeminent supplier of e-business solutions. We're focusing on providing carrier class e-business services to both emerging e-companies and established companies who are adding e-capabilities to their service set," Ebbers continued. "As e-business becomes a mission critical component for many large companies they will look for established, reliable, proven providers that can do for e-business what they have done for large, sophisticated private networks. Finally, because we leverage our ownfacilities end-to-end, we're in an ideal position to offer complementary services like hosting and a full range of web solutions from turn-key to complex, managed services."

COMMUNICATIONS SERVICES - REVENUE COMPARISON

                   Financial Reporting       Excluding Embratel
                -----------------------   ------------------------
 ($ in millions)  1Q00     1Q99  Change     1Q00      1Q99  Change
---------------------------------------   ------------------------
Revenues
Voice           $ 5,363  $ 5,216    3%    $ 5,363  $ 5,216     3%
Data              2,146    1,702   26%      2,146    1,702    26%
Internet          1,104      758   46%      1,104      758    46%
International     1,365    1,043   31%        537      357    50%
---------------------------------------   ------------------------
Communications  $ 9,978  $ 8,719   14%    $ 9,150  $ 8,033    14%
 services

Note: SkyTel revenues are included in the voice line item in all
periods.

DOMESTIC DATA REVENUES Data revenues grew $444 million or 26 percent from the first quarter of 1999 to $2.1 billion, driven by increases in capacity and number of connections from existing customers as well as new customer growth. The Company experienced a 95 percent increase in Voice Grade Equivalents (VGEs capture the volume of private line circuits), as well as strong increases in frame relay and ATM ports and port speeds.

INTERNET REVENUES Internet revenues increased $346 million or 46 percent year-over-year to $1.1 billion. Internet revenues were driven by strong growth in dedicated broadband connections as well as value-added services such as hosting, security services, and Internet-based virtual private networks.

WorldCom added 367,000 modems in the first quarter, and now has more than 2 million dial-up modems in service. Customers spent more than 1.5 billion hours connected to WorldCom's dial-up Internet services during the quarter, an increase of 66 percent from one year ago. In fact, customers now spend more than twice as much time on WorldCom's dial-up Internet services as they do on voice calls.

During the quarter, WorldCom and AOL announced a five-year extension of existing agreements for dial-up access services in the U.S. WorldCom's subsidiary, UUNET, has been a provider for AOLnet for several years. Under the expanded relationship, WorldCom will continue to build out and manage a significant portion of AOLnet as well as continue to provide AOL with dial-up services.