Verizon Q4 Results Beat View; Sees 2022 Profit Above View

Verizon Communications Inc. (VZ) reported that its fourth quarter net income attributable to the company increased 0.5% to $4.61 billion from $4.59 billion in the prior year. But earnings per share was $1.11, same with last year.

Fourth-quarter 2021 earnings per share included a net pre-tax loss from special items of about $1.2 billion. This included a charge of $2.4 billion for the early extinguishment of debt, a $106 million charge related to severance, a $1.2 billion credit pertaining to annual mark-to-market for pension and other post-employment benefits liabilities, and a net gain of $131 million primarily related to the disposition of an investment.

Quarterly earnings per share, excluding special items, was $1.31, compared to $1.21 in fourth-quarter 2020. Analysts polled by Thomson Reuters expected the company to report earnings of $1.29 per share for the fourth quarter. Analysts' estimates typically exclude special items.

Total consolidated operating revenues for the fourth-quarter 2021 were $34.1 billion, down 1.8 percent from fourth-quarter 2020. Analysts expected revenues of $33.89 billion for the fourth quarter.

Adjusting for the sale of Verizon Media on September 1, quarterly operating revenue grew 4.8 percent year over year. Strong wireless service revenue growth and wireless equipment revenue were offset by continued declines in legacy wireline products.

In fourth-quarter 2021, Consumer reported 667,000 wireless retail postpaid net additions. This consisted of 336,000 phone net additions and 369,000 other connected device net additions, offset by 38,000 tablet net losses. Consumer also reported 85,000 wireless prepaid net losses, which included TracFone results since November 23.

For 2022, Verizon expects adjusted earnings per share to be in the range of $5.40 to $5.55. Analysts expect annual earnings of $5.39 per share for fiscal year 2022.

The company expects annual organic service and other revenue growth of around 3 percent. On a reported basis, which includes the net impact of the sale of Verizon Media and the company's ownership of TracFone, service and other revenue growth is expected to be in a range of 1.0 percent and 1.5 percent.

The company projects annual reported wireless service revenue growth in the range of 9 percent to 10 percent. Excluding the impact of the TracFone acquisition, wireless service revenue is expected to grow at least 3 percent.

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