Verizon Wireless service revenue rises 7.5 pct
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U.S. telecommunications group Verizon Communications Inc posted a record quarterly profit thanks to its wireless business, even as corporate customers delayed renewing contracts amid continued economic uncertainty at home and abroad.
Verizon said on Thursday it was on track to meet 2012 financial goals, with capital spending for the year expected to be lower than the $16.2 billion total in 2011.
Like rivals AT&T Inc and Sprint Nextel Corp, Verizon Wireless is spending billions of dollars to upgrade its network to support booming demand for services like web surfing and video on smartphones like Apple Inc's iPhone. Higher data usage can translate into better profits.
Wireless achieved record profitability in a quarter in which we reported the highest number of retail postpaid gross and net adds in four years, Chief Executive Lowell McAdam said in a statement, referring to new customer numbers.
For the third quarter, Verizon's profit rose to $1.59 billion, or 56 cents per share, from $1.37 billion, or 49 cents per share, in the year-ago quarter, when the firm was hit with costs from a two-week workers' strike and weather damage.
Revenue increased to $29.01 billion from $27.91 billion in the year-ago quarter. Analysts, on average, expected revenue of $28.96 billion, according to Thomson Reuters I/B/E/S.
Excluding unusual items, the company earned 64 cents per share, in line with expectations.
Shares rose 3.6 percent to $46.33 near midday.
Macquarie Capital analyst Kevin Smithen said in a note that Verizon was the undisputed champion of US wireless and perhaps global wireless.
Its Verizon Wireless venture with Vodafone Group Plc added 1.8 million net new subscribers in the quarter, compared with 882,000 in the year-ago third quarter.
Verizon Wireless, the No. 1 U.S. mobile provider, posted a 7.5 percent increase in quarterly service revenue to $ 16.2 billion.
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