Verizon Net Income Down on Wireline Performance
Verizon Communications' revenue rose 1.9 percent, but net income dipped 2.8 percent in the second quarter of 2009 compared to a year earlier, with the company's traditional wireline income taking a big dive.
Verizon on Monday reported revenue of US$26.9 billion in the second quarter, compared to $26.4 billion in the second quarter of 2008. Net income was down from $5.2 billion to $5 billion. Those numbers are adjusted to account for Verizon's acquisition of AllTel in January.
Adjusted earnings per share for the second quarter were $0.63, meeting analyst expectations, according to Thomson Reuters.
Verizon's wireline business drove the decline in net income. The company saw net income of $1.1 billion in the second quarter of 2008, but only $555 million in the second quarter of 2009. Wireline revenue was down 5.2 percent to $11.5 billion. Global enterprise and global wholesale revenues were down, the company said in a press release.
Broadband connections, however, grew by 9.4 percent in the quarter. Verizon reported serving 9.1 million broadband customers at the end of the quarter, a net increase of 186,000 from the first quarter. Verizon's DSL (digital subscriber line) connections decreased by 117,000 during the quarter, but those losses were offset by 303,000 new Fios fiber-based broadband customers.
Verizon also reported 300,000 new Fios television customers during the quarter.
Verizon's wireless division also reported customer increases.
The company now has 87.7 million wireless customers, with 1.1 million net additions during the quarter. Wireless revenue rose from $14.4 billion in the second quarter of 2008 to $15.5 billion this past quarter and net income rose from $4 billion to $4.5 billion.
Verizon's wireless revenue growth was "strong," Chairman and CEO Ivan Seidenberg said in a statement. He attributed the overall revenue growth to "resilience in consumer demand for our wireless, broadband and video products."