Verizon and AT&T Report Landline Declines, IP Gains
Posted by Jesse Ward on Monday, July 27, 2009 · 
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Verizon Communications said today that it would eliminate 8,000 jobs as a result of its Q2 financial results.
The company reported net income of $1.48 billion, or 52 cents a share, down from $1.88 billion, or 66 cents in 2008, a 21% decline. Most of that decline was related to the company’s sale of some rural phone systems to Frontier Communications. Excluding charges associated with the merger, Verizon earned 63 cents a share, in line with analysts’ estimates but still down 6% from Q2 2008.
Total revenue increased by 11.6% to $26.9 billion, but most of that growth is attributable to its acquisition of Alltel. The company’s core business grew only by 1.9%, much slower than the 5.3% pace of a year ago. Likewise, wireline revenue was down 5.2% to $11.5 billion, primarily due to a loss in business customers.
Verizon lost nearly 2 million home-phone customers during the past year. However, the news is not all bleak. Wireless revenue was $15.5 billion, up 9% mainly due to increased cellular data plans. And the company added 300,000 new FiOS TV customers in the quarter, and 303,000 FiOS Internet customers.
AT&T reported a similar story. The carrier’s consolidated second quarter revenues of $30.7 billion were down by 0.4% when compared with last year, but up sequentially. AT&T’s net income was $3.2 billion, while diluted earnings per share totaled $0.54 and cash from operating activities totaled $7.9 billion.
AT&T noted that consumer broadband IP services (broadband data and U-Verse TV), business VPNs and VoIP services all saw growth. In fact, AT&T added 248,000 new U-Verse subscribers in Q2, and total IP data revenues grew 5.2% to $6.6 billion. However, AT&T continues to note decreasing landline subscribers, which were down 13.4% during the quarter.
Verizon’s release.
AT&T’s release.
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