Verizon Communications Inc. (VZ) reported a profit for the first-quarter 2017 that declined 20.0 percent from the prior year, while quarterly operating revenues decreased 7.3 percent.
Adjusted earnings per share as well as revenue for the quarter missed analysts' expectations.
In the Thursday's pre-market trade, VZ is trading at $48.10, down $0.84 or 1.72 percent.
Looking ahead for 2017, the company still expects consolidated revenues, on an organic basis, to be fairly consistent with 2016, with improvement in wireless service revenue and equipment revenue trends; also, full-year 2017. Consolidated adjusted earnings per share trends to be similar to consolidated revenue trends.
Consolidated capital spending for 2017 is expected to be in the range of $16.8 billion to $17.5 billion.
Net income attributable to the company for the first-quarter declined 20 percent to $3.45 billion from the prior year's $4.31 billion, with earnings per share decreasing to $0.84 from $1.06 in the previous year.
Adjusted first-quarter 2017 earnings per share of $0.95 included a net of 11 cents per share in early debt redemption costs and a gain on a spectrum license transaction. Analysts polled by Thomson Reuters expected the company to report earnings of $0.96 per share for the quarter. Analysts' estimates typically exclude special items.
Total consolidated operating revenues for the first-quarter 2017 were $29.81 billion, a 7.3 percent decrease from last year's $32.17 billion. On a comparable basis excluding divestitures and acquisitions in the period, consolidated revenue declined approximately 4.5 percent. Analysts expected revenue of $30.49 billion for the quarter.
In Wireless, Verizon's retail postpaid connections base grew 1.2 percent year over year to 108.5 million, and retail prepaid connections grew 0.5 percent to 5.4 million.
In Wireless segment, Retail postpaid churn was 1.15 percent in first-quarter 2017, a year-over-year increase of 19 basis points primarily due to increased churn in tablets. Phone customer loyalty remained high, with retail postpaid phone churn of less than 0.90 percent for the eighth consecutive quarter.
Wireless segment's total revenues were $20.9 billion in first-quarter 2017, a decline of 5.1 percent compared with first-quarter 2016, due to decreased overage revenue, lower postpaid customers in the quarter and continued promotional activity.
Total wireline revenues declined 0.6 percent, to $7.9 billion, comparing first-quarter 2017 with first-quarter 2016. Consistent with recent trends and on a comparable basis (non-GAAP), this decline was 3.2 percent, excluding revenues from XO Communications in first-quarter 2017.
In first-quarter 2017, Verizon added a net of 35,000 Fios Internet connections and lost a net of 13,000 Fios Video connections. At the end of first-quarter 2017, Verizon had 5.7 million Fios Internet connections and 4.7 million Fios Video connections, year-over-year increases of 3.3 percent and 0.1 percent, respectively.
On Tuesday, Sunnyvale, California-based Yahoo reported first-quarter profit of $99.4 million or $0.10 per share, compared to last year's loss of $98.3 million or $0.10 per share. Last year, Yahoo recorded a restructuring charges of $57.2 million. Yahoo said it continues to work with Verizon on integration planning for the sale of its operating business. The company anticipates the closing to occur in June 2017.
In July last year, Verizon agreed to acquire Yahoo's core internet business for $4.83 billion. However, the deal seems to have reached a hurdle because of the data breach at the internet company that affected more than 500 million accounts.
In February 2017, Verizon Communications and Yahoo! announced that they amended the existing terms of their agreement that would reduce the price Verizon would pay for the internet company's core business by $350 million. In addition, the companies would share certain legal and regulatory liabilities arising from certain data breaches incurred by Yahoo.
Verizon's acquisition of Yahoo valued at approximately $4.48 billion in cash, subject to closing adjustments.
by RTT Staff Writer
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