Verizon's (NYSE: VZ) wireline business performance in Q1 2011, much like its RBOC brother AT&T (NYSE: T), continues to be driven by ongoing FiOS growth and a continued drive into managed cloud-based services for businesses.
During Q1 2011, Verizon reported wireline revenues of $10.15 billion, down 2.2 percent from first-quarter 2010, a factor that it attributes to ongoing landline voice erosion. Analysts had forecast $10.24 billion in revenues for the wireline unit. However, wireline EBITDA of $2.39 billion surpassed forecasts.
Here's a breakdown of Verizon's key wireline metrics:
- Broadband growth: In Q1 2011, Verizon added 207,000 net FiOS Internet and 192,000 net FiOS TV additions, bringing it to 4.3 million total FiOS Internet connections and 3.7 million total FiOS TV connections.
- Consumer revenues: Driven by ongoing gains in FiOS data and TV, consumer revenues grew 1.9 percent from Q1 2010. Likewise, consumer wireline service ARPU increased 10.5 percent from Q1 2010 to $90.55 and ARPU for FiOS customers continues to be more than $146. As expected, Verizon's traditional PSTN voice lines declined 8.2 percent to 25.5 million--the smallest year-over-year decline it said has seen since Q1 2008.
- Business Services: By increasing its focus on new strategic enterprise services, including cloud and Ethernet services, Verizon's business revenue rose 12.8 percent to $3.8 billion. Meanwhile, global wholesale revenue declined $162 million year over year due to slowing international voice revenue.
From an overall company perspective, Verizon's earnings rose up to $1.44 billion, or 51 cents a share, from $443 million, or 16 cents a share in Q1 2010 due to one-time charges.
Revenue, meanwhile, increased to $26.99 billion from $26.86 billion in Q1 2010. Analysts had forecast revenues of $26.86 billion for Q1 2011.
For the full year 2011, Verizon expects top line revenue growth rates between 4-8 percent and EPS growth of 5-8 percent.
Wireline in the first quarter of 2011
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