Verizon Q1 Earnings Disappoint Wall Street With Revenue, Profit Decreases

Verizon Communications reported decreases in wireless and wireline revenues for the first quarter of this year compared to the same quarter in 2016.

Total operating revenues in the first quarter were $29.8 billion, a 7.3 percent decrease from $32.1 billion in the year-ago quarter. Net income totaled $3.5 billion, down nearly 20 percent from $4.4 billion in the year-ago quarter. First-quarter earnings fell below Wall Street expectations.

“Our first-quarter results again demonstrated that customers value a high-quality network experience,” said Lowell McAdam, Verizon’s chairman and CEO. “To build on our loyal customer base and the third-party recognition we have received for network leadership, we extended our wireless and fiber network capabilities, began offering an unlimited pricing option and expanded our opportunities in new markets. We’re executing on strategies to capture future growth and create long-term shareholder values.”

Wireless revenues totaled $20.9 billion for the quarter, a 5.1 percent drop compared with first-quarter 2016, due to decreased overage revenue, lower postpaid customers and continued promotional activity.{ad}

Verizon reported a loss of 307,000 retail postpaid connections during the quarter, including 289,000 phone losses. Prior to the launch of its unlimited plan in mid-February, Verizon had a retail postpaid phone loss of 398,000. After the launch, it added 109,000 retail postpaid phone connections. For the entire quarter, Verizon added a net of 49,000 smartphones to its retail postpaid phone base.

Total wireline revenues declined .6 percent, to $7.9 billion, comparing first-quarter 2017 with first-quarter 2016. Total Fios revenues grew 4.7 percent, to $2.9 billion. This supported revenue growth of .7 percent in consumer markets and 2.3 percent in business markets.

Verizon added 35,000 Fios Internet connections and lost 13,000 Fios Video connections. At the end of the quarter, Verizon had 5.7 million Fios Internet connections and 4.7 million Fios Video connections, year-over-year increases of 3.3 percent and 0.1 percent, respectively.

Verizon completed its XO Communications’ fiber-optic network business during the quarter as part of its plan to expand its cell network.