Verizon quarter hurt by Sandy, pension issues
Wall Street shrugs off the disappointing results, however. The company's wireless segment adds 2.2 million net customers.
Verizon posted a fourth-quarter loss of $1.93 billion, or $1.48 per share, versus a loss of $212 million, or 71 cents, a year earlier as pension liabilities and Superstorm Sandy eroded profit. Revenue climbed 5.7% to $30 billion, the highest quarterly increase in 2012 and one fueled by gains in its wireless business. Excluding one-time items, profit was 38 cents, lagging the 50-cent average estimate of analysts surveyed by Bloomberg News. Revenue beat expectations of $29.83 billion.
As the wireless market continues to mature, companies are finding it increasingly difficult to maintain their competitive edge. Though Verizon Wireless added 2.2 million net customers in the fourth quarter, they came at a steep price: Most signed up for smartphones, devices the company heavily subsidizes.
Earlier this month, Verizon warned that the costs associated with providing two-year service contracts to Apple (AAPL) iPhone customers would hurt profit. The company activated 6.2 million iPhones in the quarter.
"They have to offer enormously expensive phones at affordable prices to move customers onto higher-priced plans," Avi Greengart, an analyst with Current Analysis, told Bloomberg.
During the quarter, Verizon added 44,000 FiOS net Internet and 134,000 FiOS Video net additions. A year earlier, Verizon added 194,000 FiOS TV customers. Wireline operating revenues fell 1.5% to $10 billion. Retail churn, a measure of how many customers drop the service, was 1.24% in the fourth quarter, up 1 basis point. Capital expenditures were $16.2 billion in 2012, little changed from a year earlier despite added costs from Sandy.
--Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.
More on moneyNOW
- Airlines tighten frequent-flier rules
- Batmobile sells for $4.6 million
- Wal-Mart mulls health coverage for small businesses
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] The stock market ended the holiday-shortened week on a mixed note as the Dow Jones Industrial Average shed 0.1%, while the S&P 500 added 0.1% with seven sectors posting gains.
Equity indices faced an uphill climb from the opening bell after disappointing quarterly results from Google (GOOG 536.10, -20.44) and IBM (IBM 190.04, -6.36) weighed on the early sentiment. Google reported earnings $0.15 below the Capital IQ consensus estimate on revenue of $15.42 ... More
More Market News
Remy Cointreau says it was 'adversely affected' by China's anti-extravagance policy.
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'