Verizon Meets EPS Target, FiOS Growth Is Ho-Hum
Verizon (NYSE: VZ) shares fell 2 percent in early trading after it met earnings expectations on sluggish revenue growth, especially with its FiOS TV and Internet business.
The company posted earnings ex items of $4.28 billion, or 64 cents a share, up 19% from $3.6 billion, or 57 cents a year earlier. Analysts had been expecting earnings of 64 cents, on average.
Free cash flow so far this year has more than doubled from the same period a year ago.
Revenue rose 3.7% to $28.6 billion, also in line with expectations.
The wireless business posted a stronger-than-expected result. The company added 888,000 wireless contract customers in Q2; down from last year, but above most analyst expectations. Profit margins from that business rose to 49 percent, excluding items.
Yet mass markets revenue – including the FiOS business, rose 1.7 percent from the same period last year. The company added only 134,000 FiOS Internet subscribers; it now has 5.1 million. However, the company posted 16 percent growth for the FiOS triple-play package, of phone, TV and Internet services.
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