MCI Inc. reported second-quarter net income of $64 million, or 19 cents a share, compared to a net loss of $71 million, or 22 cents a share, for the year-ago quarter. Analysts had expected MCI to post a net loss of 1 cent a share for the quarter. Revenue declined 10% to $4.68 billion versus $5.22 billion.

Operating expenses declined 11% to $4.6 billion due to last year's restructuring efforts. The company said it recognized depreciation and amortization expense of $325 million in the latest quarter, versus $569 million in 2Q of 2004.

For the first six months of the year, MCI posted net income of $62 million, or 19 cents a share, versus a net loss of $459 million for the first half of 2004. The latest half's results included $653 million of depreciation and amortization expense, vs. $1.1 billion in the year-ago period. First-half revenue dropped 11% to $9.5 billion.

Merger-related expenses amounted to $29 million in the latest six months, while severance expense was $40 million and reorganization costs totaled $16 million.

The Zurich-based bank UBS AG posted a 5% increase in 2Q net profit Tuesday, as growing revenue from the company’s industrial holdings helped offset a modest performance from its investment bank.

UBS said net profit for the quarter advanced to 2.15 billion Swiss francs ($1.71 billion) from 2.04 billion francs in the year-ago quarter.

Overall 2Q revenue totaled 12.01 billion francs, up 18% vs. a year earlier. Revenue from the company’s industrial holdings nearly quadrupled, but revenue from the bank's financial business lost 1%.

At the investment bank, trading revenue declined 17%, as slightly rising revenue in equities failed to offset plunging fixed-income and foreign-exchange revenue.

Pretax earnings from private banking jumped 11% on higher asset-based fees and interest income.

Early Tuesday in Zurich, UBS shares slid 1.40 francs, or 1.3%, at 104.50 francs, with the broader market also lower.

McDonald's Holdings Co. Japan, a unit of McDonald's Corp., announced Tuesday its net profit for the six months to June tumbled 58% vs. last year due to the difficult business environment for the burger chain.

Nevertheless, the company, which is 50%-owned by the U.S. hamburger giant, kept unchanged its full-year earnings forecast, hoping its new price strategy will pay off in the second half of the year.

McDonald's Japan said its group net profit declined to 474 million yen ($4.2 million) vs. 1.12 billion yen in the first half of last fiscal year.

Group sales jumped 5.3% to 157.63 billion yen vs. 149.66 billion yen. Group operating profit declined 68% to 840 million yen vs. 2.65 billion yen last year.

For the first half, the number of customer visits to core unit McDonald's Japan stores grew 12%. But consumers preferred 100 yen burgers and other cheaper items, leading to a 7.6% drop in per-customer spending. Same-store sales in the half added 3.2%.

For the full fiscal year ending Dec. 31, the Japanese company said it still sees a group net profit of 3.55 billion yen and group sales of 325.05 billion yen.

Blockbuster Inc. (BBI: chart) Tuesday reported a quarterly loss vs. a year-ago profit, as lackluster new video releases were not able to attract consumers.

The company also announced it is unlikely to meet its earlier financial forecast, citing continuing declines in the video rental market.

Excluding severance costs, asset impairment charges and stock-based compensation, the loss was 22 cents a share. On that basis, analysts had expected a loss of 10 cents a share.