Verizon earnings

Verizon Business details its third quarter

Doug Mohney — Tue, 28 Oct 2008 10:18:50 -0400

On the day after parent Verizon posted its third quarter numbers, Verizon Business is providing details on how it put $5.4 billion into the bigger financial picture.

Focused on large business and government customers, Verizon Business reported its eighth consecutive quarter of year-over-year pro-forma revenue growth, with global enterprise revenue increasing 0.7 percent to $4.0 billion compared with the year-ago quarter.

"Strategic services" such as security solutions, IT solutions and professional and managed IP services continue to drive growth, generating $1.6 billion in revenue for a 15.4 percent increase from the third quarter in 2007. The company added a new set of professional services to make the most of virtualization and teamed with Cisco to announce an expanded set of unified communications and collaboration tools. Verizon Business also added new managed WLAN service and new professional and managed services support for network access control (NAC).

Globally, Verizon Business announced it turned up the first phase of the Trans-Pacific Express submarine cable system and began a significant expansion of its operations in India to support the direct delivery of services to multinationals in that country, including IP nodes in Bangalore, Chennai, Hyderabad, Mumbai and New Delhi.

New customer deals include agreements with American Express, CA, The Coca-Cola Company, First Data, H&R Block, Husqvarna and Kuwait Petroleum International Ltd for a wide range of advanced communications and information technology solutions.

For more:
- Read the Verizon Business press release.

Verizon profit surges 31 percent

Dan O'Shea — Mon, 27 Oct 2008 08:56:00 -0400

On a day in which its news may be overshadowed by the report of two smaller telcos merging, telco giant Verizon Communications reported third quarter earnings that included a 31 percent hike in net income to about $1.67 billion, up from $1.27 billion for the same quarter last year. Total revenue was up 4.1 percent to $24.8 billion, but the strength, as usual, came from the wireless side of the business, as wireline revenue slid 1.7 percent to $12.2 billion.

Verizon lost about 1.19 million landlines during the third quarter, and DSL subscribers declined by about 96,000. On the bright side, Verizon reported 233,000 net subscriber additions for its FiOS TV offering and 225,000 new FiOS Internet customers. Broadband and video service revenue growth drove consumer ARPU in legacy Verizon wireline markets upward by 12.8 percent to $66.67.

Additionally, the company reported that Verizon Business raked in $5.4 billion in revenue, which inched up about 1.2 percent from the same quarter last year. And, while telecom industry watchers await further information this morning on Centurytel's acquisition of Embarq, Verizon reiterated that its own rural-themed $28 billion acquisition of Alltel is on track to close by the end of this year, despite credit market turbulence.

For more:
The Street.com has this post

Seidenberg optimistic about telecom, wants to fix Knicks

Dan O'Shea — Thu, 16 Oct 2008 08:50:31 -0400

Verizon Communications will not report third quarter earnings until Oct. 27, but Verizon CEO Ivan Seidenberg, speaking at the Dow Jones-Nielsen Money and Media Conference this week, took an optimistic stance on the economy--or at least the strength of telcos amid economic difficulty--rather than stressing caution.

Seidenberg didn't dispute that lower consumer spending and more disconnections may occur. But he maintained it would be a temporary condition, and that those same customers would return to their spending ways again. Is he really trying to prepare us for a soft earnings report by telling us ahead of time not to worry?

He also said the telecom industry is not having the "liquidity issues" seen in other industries, and that companies in general need to quit worrying about the economy and keep re-investing in creating a "competitive edge" for America.

Aside from these comments, Seidenberg also addressed what he said was a common question: Will Verizon "go vertical" and acquire content or other types of properties, something for which its New York competitor Cablevision Systems is famous? Seidenberg joked, "If I could buy the Knicks and fix them, I would."

It may have been the comment of a true fan, but it was also a pretty good dig at Cablevision, owner of the New York Knicks basketball franchise, which this year will look to avoid its eighth straight losing season. Seidenberg's level-headed, but often playful, commentaries make him one of the favorite speakers among telco CEOs--though the competition may not be so tough to beat.

For more:
- see this blog post at The Wall Street Journal
- check out this report at The Daily Deal

Third quarter earnings are upon us

Dan O'Shea — Mon, 13 Oct 2008 11:15:40 -0400

Amid record stock market plunges and widespread fears about the health of the overall economy, the telecom industry's major players are about to report third quarter earnings. Investors will have one eye trained on vendor outlooks and the other on the carriers' consumer segment and business market revenues.

Here's a look at some key upcoming earnings reports, and important issues pertaining to each. Watch FierceTelecom closely in the weeks ahead for the latest news on third quarter earnings in the telecom sector.

Adtran, Oct. 14: Some general comments by Adtran officials in the vendor's second quarter report led some sector watchers to believe that middle-tier telcos were tightening their spending. How will the company be affected by speculation that key customer Embarq is for sale? Has a move into the gigabit passive optical network market strengthened Adtran?

Tellabs, Oct. 21: Tellabs stated, more explicitly than Adtran, in its second quarter earnings report that spending in the North American carrier market was weak. New CEO Rob Pullen has been aiming to focus the company more on international business opportunities. So, how is that plan panning out? Also Tellabs started the year as a potential acquisition target in the eyes of some, yet the current market environment would seem to discourage such prospects.

AT&T, Oct. 22: The first major U.S. telco to report third quarter earnings could confirm the sector's mood for months to come. Will U-verse have a strong quarter? Is the tough economy forcing more consumer disconnections? AT&T had indicated second-half capex would be lower than the first-half--what's the new outlook? The telco recently re-aligned its structure in a way that better integrates wireless and de-emphasizes reliance on isolated wireline endeavors, so expect further details on that move.

Verizon, Oct. 27: Verizon was the first telco to acknowledge that slowing growth in DSL wasn't just a seasonal issue. The telco has continued to aggressively roll out FiOS broadband and TV, while modifying its DSL speeds, packages and prices. The country's largest telco TV provider will be closely watched to see if TV subscriptions re-gain momentum and continue their upward trend.

Embarq, Oct. 29: Embarq, the largest independent telco, reportedly has been looking to sell, though the possibility of a deal seems less likely amid turbulent economic trends. Could the company now be looking at selling its Embarq Logistics unit? As 2008 dawned, Embarq was eying the possibility that consolidation could re-shape its end of the telecom industry, the portion most harshly affected by landline loss. Those landline numbers again will be watched closely.

Alcatel-Lucent, Oct. 30: The vendor may benefit from the possibility that expectations can't go much lower than they already are. This will be new CEO Ben Verwaayen's first earnings report, so it will be interesting to see if the company shovels out even more bad news while it still has the right to, or if it takes a completely different attitude. All eyes will be on the company's fourth quarter and remaining 2008 full-year outlook.

Windstream, Nov. 7: Like Embarq, Windstream has been seen as being at the center of potential independent telco consolidation. Again, it seems unlikely that such deals will happen soon, which leaves Windstream exposed to landline loss trends. Yet, according to some, Wndstream has done well off-setting landline decline with improving revenue elsewhere. Can it keep up the good work?

-Dan

Verizon net income up 12% on wireless, FiOS

Dan O'Shea — Mon, 28 Jul 2008 10:04:23 -0400

Wireless and FiOS broadband efforts again proved to be the growth engines for Verizon Communications, as the telco posted second quarter earnings marked by a 12 percent boost in profit over last year's second quarter to $1.88 billion, or 66 cents per share. Revenue hit $24.1 billion. Verizon Wireless showed revenue growth of 12 percent on data service revenue growth of 45 percent, along with net subscriber additions of 1.5 million for the quarter.

Meanwhile, the FiOS broadband network did its parts to strengthen Verizon, too. The company added 187,000 FiOS broadband customers during the quarter, and about 176,000 FiOS TV customers. The telco now has surpassed 2 million FiOS broadband customers and 1.4 million TV subscribers. Both service sectors helped Verizon to a 10.4 increase in revenue from its legacy wireline properties, even though landline voice revenue was down about 1.8 percent.

For more:
- see this update at The Wall Street Journal

Related articles:
Verizon posted impressive revenue growth for 2007. Verizon report
Verizon wants all of Verizon Wireless for itself. Verizon report

Verizon says it'll raise FiOS prices again

Tue, 29 Apr 2008 06:59:55 -0400

Verizon's FiOS users can expect to pay a little more, the company said during its earnings call yesterday. FiOS broadband has seen steady price increases for customers who don't sign up for long-term contracts or who decline to add additionally services. The Associated Press said Verizon FiOS customers currently pay an average $129 per month for the service; Verizon added 263,000 customers in the first quarter, bringing its overall FiOS total to 1.2 million.

"You may recall we increased prices for selected products in the first quarter last year," said CFO Doreen Toben while discussing FiOS. "We anticipate increasing prices once again in certain products and bundles in the second quarter this year."

For more:
- Read the story at Broadband Reports

Verizon Q1 profit rises, TV subs up 263,000

Mon, 28 Apr 2008 06:59:57 -0400

Is the tel-economic freak out over already? While 2007 ended with uncertain financial outlooks by carriers, 2008 has started quite well for the two biggest U.S. telcos. Last week, AT&T reported a 22 percent increase in profit for the first quarter of 2008, and today, Verizon Communications reported a 9.8 percent increase in profit for the quarter. Verizon said net income totaled $1.64 billion, with revenue rising about 5.5 percent. Both big carriers credited wireless as the engine that drove them to increased profit, but in both cases, broadband Internet and TV services growth did their part as well. Verizon added 263,000 FiOS TV customers and about 262,000 FiOS broadband Internet customers. It now serves about 1.2 million TV customers.

Meanwhile, the residential landline business only continues to further fade. Verizon reported an 11 percent decline in residential landlines and a total landline decline of 8.2 percent. Wireline revenue dropped about 1.4 percent. While AT&T's and Verizon's first-quarter earnings reports can allow us to breathe a sigh of relief for now, industry watchers will remain on the lookout for the first signs of any slow-down.

For more:
- see this story at The Wall Street Journal
- and this blog post at ZDNet.com

Related articles:
AT&T reported its first quarter earnings last week. AT&T report
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Retirees: Separate Verizon chairman, CEO jobs

Tue, 01 Apr 2008 07:59:57 -0400

A proxy group for Verizon Communications retirees called the Association of BellTel Retirees is planning to propose at the company's annual shareholder meeting on May 1 that Verizon's chairman and CEO jobs be separated and not held by the same person. If the group sounds familiar, that is because BellTel Retirees was the organization that pushed for and won the right for Verizon shareholders to be able to vote on issues of executive compensation. Verizon directors aren't required to act on the vote, but winning that right was a significant step forward for the representation of retirees in company matters, and Verizon is one of few public companies that actually allow such a vote.

Currently, Ivan Seidenberg is chairman and CEO of Verizon, and has been for several years, while Denny Strigl is president and chief operating officer. BellTel Retirees claims to have about 110,000 members and aims to represent more than 220,000 retirees from Verizon and affiliated firms, including Bell Atlantic, Nynex, GTE and MCI. It remains to be seen whether or not this proposal will gain steam leading up to the shareholders meeting. It is worth noting that during the industry downturn earlier this decade, there was a broad movement to re-evaluate the tradition of having the same person hold chairman, CEO and president responsibilities. In some cases, it was determined that companies would not be able to recruit the highest-caliber executives if they split up the jobs, though a few companies made a concerted effort to do so. It is also worth noting that over at AT&T, Randall Stephenson is chairman, CEO and president.

For more:
- see this Associated Press story at BusinessWeek

Related article:
- Check out more Verizon news, including Seidenberg's 2007 compensation, here

Seidenberg sees no ill economic effects

Thu, 20 Mar 2008 07:59:54 -0400

Verizon Communications CEO Ivan Seidenberg took a moment at Verizon Wireless' Open Development Conference yesterday to comment on the effect of general economic instability on Verizon's wireline and wireless businesses. Well, he actually said there was no effect, "nothing out of the ordinary," as he put it, that has altered sales figures or general progress. That comment goes against the prevailing industry feeling at the moment that some market indicators are wobbling and only uncertainty lies ahead.

For more:
- read this Dow Jones Newswires brief at CNN Money

Related article:
- Verizon has said before it wasn't being slowed by the U.S. economy

Seidenberg takes home $20.3 million

Tue, 18 Mar 2008 07:59:56 -0400

Verizon Communications CEO Ivan Seidenberg saw his total compensation package reach about $20.3 million for 2007, a very slight increase over what Seidenberg was paid the previous year, according to a report from the Associated Press. The compensation counted a salary of $2.1 million, a bonus of $4.2 million, a stock award of about $13.1 million and perks worth about $825,312, including $149,023 worth of personal use of a corporate aircraft.

Verizon said in a regulatory filing yesterday that the company had hit all marks during 2007 on which CEO pay is based. The company's stock value has been sagging since 2008 opened, making it easy to forget the stock price actually rose more than 17 percent during 2007. So, we'll ask the same question we asked recently when BusinessWeek reported compensation figures for AT&T CEO Randall Stephenson: Is Seidenberg's compensation fair or out of whack? Post a comment and let us know what you think.

For more:
- read this article from the Associated Press

Related article:
- Stephenson, who spent half of 2007 as CEO of AT&T and half as vice chairman, collected $18 million last year

Credit Suisse downgrades AT&T, Verizon

Wed, 20 Feb 2008 06:59:57 -0500

Credit Suisse analyst Christopher Larsen downgraded his price targets for both AT&T and Verizon Communications, lowering his target for AT&T to $39 from $49, and Verizon to $40 from $52. He also downgraded the entire telecom sector. He cited both companies' moves this week toward flat-rate wireless plans as part of the reasoning, but also noted that overall, broadband adoption is slowing and many telecom companies are facing uncertain economic forecasts.

The slowing of broadband growth has become a major point of concern since the middle of last year. Some analysts now expect broadband subscribers for telco and cable TV companies to grow 20% less in 2008 than in 2007.

For more:
- check out this Associated Press story at The Houston Chronicle
- see this Investor's Business Daily story at CNN Money

Related articles:
- Independent telco CenturyTel recently issued its own tempered outlook

Recession talk not stopping broadband

Tue, 29 Jan 2008 06:59:56 -0500

Is there a recession or not? Is there a slowdown in the broadband business or not? I have a feeling we will continue debating both of these questions until long after it stops making sense to ask them. AT&T recently said it saw something of a market slowdown related to consumer disconnects, but its fourth-quarter earnings suggested no current corresponding financial weakness, and it adjusted its earlier position by saying the housing market blues weren't having a direct effect on its business. Verizon Communications said yesterday that its TV service was growing rapidly, while net income and revenue were up, and it too said there was no slowdown related to general economic troubles. Yet, some observers had expected FiOS subscriber additions to be around 300,000 for the quarter, much higher than the 226,000 it posted.

Both companies continue to boost broadband speeds, and Qwest Communications is right behind them, so they all better hope the housing market has hit bottom. Meanwhile, there is some evidence that the online video revolution is moving faster than either AT&T's or Verizon's own impressive video efforts, and that companies such as high-end TV manufacturers are moving to connect viewers to Internet content that would side-step telco TV services. If you know what's really going on, let the rest of us in on it.

For more:
- read this piece about the broadband market in BusinessWeek
- see this story about Internet TV, also in BusinessWeek
- and check out this post-mortem of Verizon's earnings at TheStreet.com

Related articles:
- Can Verizon defy gravity? Article

Verizon: FiOS gets 1 mil. subs, net income up

Mon, 28 Jan 2008 06:59:57 -0500

Verizon Communications announced in its fourth-quarter earnings report that it ended the quarter with about 943,000 FiOS customers, but has in the last month crossed the 1 million mark. The company signed up 226,000 FiOS subscribers during the fourth quarter. With the FiOS network now reaching more than 9 million homes, there is plenty of work yet to be done, but as Light Reading notes, the telco now has more FiOS customers than it does DirecTV customers, which is a worthy measurement of telco TV success.

Meanwhile, Verizon saw a slight increase in net income to $1.07 billion during the fourth quarter of 2007, compared to about $1.03 billion in the final quarter of 2006. That translates to 37 cents earnings per share for Q4 2007, compared to 35 cents EPS for Q4 2006. In addition to the FiOS growth, ongoing wireless growth predictably was a leading source of strength.

For full coverage by our expert Fierce reporters and commentators of the Verizon Q4 result and expectations for 2008 go to our Verizon special report.

For more:
- read this story at Light Reading

Related Articles:
- FiOS underpins bullish '08 for Verizon Article

Data demand drives Verizon's Q3 revenues

Sat, 26 Jan 2008 01:07:30 -0500

Although Verizon Communications posted a 34 percent overall drop in third-quarter profits following a decline in new Internet subscriptions, the communications giant's wireless unit reported revenue growth of 14.4 percent, buoyed by subscriber growth and demand for data services. Verizon Wireless posted 1.8 million retail net customer additions and revenues totaling $11.3 billion--service revenues were $9.7 billion, with the operator citing retail service ARPU of $52.17 (up 1.9 percent year-over-year) and retail data ARPU of $10.59 (up 42.9 percent). Retail churn fell 1.21 percent, with postpaid churn at 0.96 percent.

According to Verizon, total mobile data revenues were up 63.4 percent over Q3 2006, resulting in $2.0 billion or 20 percent of all service revenues. The operator boasted 42.0 million retail data customers in September, a 35.6 percent increase over the prior year and a 6.2 percent sequential increase. Verizon Wireless subscribers sent or received 36.5 billion text messages and 721 million photo/video messages during the most recent quarter--they also completed 29.7 million music and video downloads.

For more on Verizon's Q3 earnings:
- read this release

Related articles:
Report: North America now leads on mobile data ARPU
Report: Verizon leads on mobile data revenue
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