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Wireless Sales Boost Verizon

January 30, 2003|From Bloomberg News

NEW YORK — Verizon Communications Inc. on Wednesday posted a profit in the fourth quarter, its second in a row, as its wireless unit added almost 1 million customers.

Net income at the telecom company was $2.29 billion, or 83 cents a share, compared with a net loss of $2.04 billion, or 75 cents, a year earlier, when investment declines and job-cut expenses crimped results. Sales climbed 1.2% to $17.2 billion, helped by a 16% jump in mobile-phone revenue.

Verizon, in contrast to rivals including SBC Communications Inc. and BellSouth Corp., may post a 2003 sales gain of as much as 2% because its wireless unit is capturing business from local customers turning to cell phones to save money.

Chief Executive Ivan Seidenberg also compensated for a seventh straight quarterly drop in phone lines by paring jobs and spending.

"It's a very well-positioned company and its performance continues to outperform peers," said Daniela Spassova, an analyst at Principal Capital Income Investors Inc., which manages $50 billion in bonds, including those of Verizon. "In wireless, it's been the real winner, taking market share from weaker rivals."

Regional carriers such as Verizon are losing local-phone customers to competitors who rent their networks at steep discounts set by regulators. SBC and Verizon are fighting to keep local customers in California. Verizon's phone lines fell 3.7% to 58 million nationwide.

To compensate, Verizon is selling long-distance service. It added 566,000 long-distance customers in the quarter, for a total of 10.4 million.

Verizon shares rose $1.60 to $37.65 on the New York Stock Exchange.

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