Verizon raises full-year profit forecast, misses subscriber estimates
By Sheila Dang and Akanksha Rana
(Reuters) – Verizon Communications Inc (NYSE:VZ) on Tuesday raised its 2019 profit forecast and beat Wall Street estimates for quarterly profit as it focuses on cost cuts, but the largest U.S. wireless carrier lost more phone subscribers than expected.
Verizon said it now expects low single-digit percentage growth in adjusted profit, after previously saying that its 2019 profit would be similar to what it reported a year earlier.
Jonathan Chaplin, an analyst with New Street Research, described the results as mixed, as Verizon’s raised guidance seemed to be “driven entirely by below-the-line items.”
Shares of Verizon were down 1 percent at $57.80 in pre-market trading.
The company said it lost a net 44,000 phone subscribers who pay a monthly bill in the first quarter, which was characterized by few big price-cut promotions. Analysts had expected a net loss of 25,000 subscribers, according to research firm FactSet.
Verizon launched its 5G mobile network in two cities in the United States last month at an additional cost of $10 for customers with existing unlimited plans. It plans to spend $17 billion to $18 billion this year to build its network.
Net income attributable to the company rose to $5.03 billion, or $1.22 per share, in the first quarter ended March 31 from $4.55 billion, or $1.11 per share, a year earlier.
On an adjusted basis, Verizon earned $1.20 per share, beating analysts’ estimates of $1.17, according to IBES data from Refinitiv.
Total operating revenue rose about 1 percent to $32.13 billion during the quarter, falling slightly short of analysts’ estimates of $32.16 billion.