September 26, 2020

IPhone Bolsters Verizon Results

Verizon Communications reported a profitable second-quarter on Friday, beating Wall Street’s expectations as the iPhone, which Verizon began selling in February, attracted new customers.

The company reported a net income of $1.61 billion, or 57 cents a share, compared with a loss of $1.19 billion during the same period a year earlier. Analysts surveyed by Thomson Reuters had expected the company to report a profit of 55 cents a share, compared with earnings of 58 cents a share in the year-ago quarter.

Revenue rose 2.8 percent to $27.54 billion, up from $26.77 billion a year ago. Analysts had expected revenue of $27.4 billion.

Ivan Seidenberg, the chief executive of the company, described the company’s results as some of the best since the rocky economic climate in 2008.

“In the second half of the year we expect Verizon to build on this strong, positive momentum to continue to drive profitable, sustainable growth,” he said in a statement.

Verizon’s results were lifted by strong growth in the company’s wireless arm, which is 45 percent owned by Vodaphone. The company reported a sharp increase — 1.3 million — in net new subscribers in the quarter. Smartphones accounted for 36 percent of Verizon Wireless’s post-paid subscriber phone base, up from 32 percent in the first quarter of the year. Verizon recently began rolling out its fourth-generation wireless network, which uses a fast wireless technology called LTE, and is heavily marketing tablets and smartphones that are compatible with that new technology.

Analysts expected that the introduction of Apple’s iPhone 4 and the company’s portfolio of 4G devices would help buoy the company’s subscriber numbers, although they did not expect so many. The company activated 2.3 million iPhones during the quarter, bringing to 4.5 million the total number of iPhones Verizon has activated since February, and it continued to see sales from its catalog of Android and 4G devices.

The company also announced that Lowell McAdam, the president and chief operating officer of Verizon, would replace Mr. Seidenberg as chief executive of the parent company on Aug. 1. The move completes a succession plan that has been under way since last year.

In a release, Mr. Seidenberg, who will retain his position as chairman of Verizon Communications, said that Mr. McAdams’s appointment is “testimony to his extraordinary record of achievement.”

“His stellar leadership of Verizon Wireless and his outstanding 28-year career in the telecommunications industry have positioned Lowell to understand the potential of our company and the actions that need to be taken every day to attain that potential.”

Article source: http://feeds.nytimes.com/click.phdo?i=0a638d7ed5829650be6581cc24fe8411

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