Verizon's Q1 wireline results get EBITDA boost from FiOS and enterprise services, but revenue misses forecasts

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.

For more:
- see the release
- Reuters has this article
- Bloomberg has this article
- here's FierceCable's take

Related articles:
Wireline in the first quarter of 2011
Verizon's Q4 revenue slips slightly while broadband, business revenue grow
Verizon's Q3 profit drops while FiOS subscribership grows
Sizing up the wireline industry in the third quarter 2010

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