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Verizon Wireless beat expectations

2009 was a bad year for many businesses with cost cutting measures resulting in significant layoffs for many of the largest tech firms in the world. The economy is starting to come back, but despite the slight rebound, many companies are not expecting a boom in 2010.

Verizon Communications reported its Q4 earnings this week and overall they were what analysts expected. Verizon also stated that it plans to cut an additional 13,000 jobs from its fixed line business this year, which works out to about 6% of the global workforce. Verizon blames the needed cuts on weak corporate spending that is hurting its landline business.

Verizon CEO Ivan Seidenberg said at an analysts meeting, "We're facing more significant headwinds than we'd thought we'd face."

Seidenberg promised analysts that Verizon would focus in 2010 on improving profits in fixed line businesses. In 2009 Verizon cut a total of 17,000 jobs and severance charges related to the layoffs gobbled up a portion of the revenue and profit for Verizon. For the quarter, Verizon posted a net loss of $653 million working out to 23 cents per share. In the same quarter of the previous year, Verizon posted a net income of $1.24 billion.

The total charges Verizon took relating to reducing its workforce amounted to $3 billion. The company would have earned 54 cents per share had the workforce reduction costs not been figured in. Overall revenue for the company was $27.1 billion. While the fixed line business at Verizon is struggling, the Verizon Wireless division is doing well. Verizon Wireless added 2.2 million customers during the quarter. Reuters reports that much of that growth can be attributed to the mass marketing of the Motorola DROID smartphone.

Analyst Christopher Larsen from Piper Jaffray said, "It was a solid quarter but not great. Retail wireless subscribers were in line with expectations. Wholesale was meaningfully ahead but they tend to be lower value customers."


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Time to buy Verizon stock
By twhittet on 1/27/2010 12:06:03 PM , Rating: 1
quote:
The company would have earned 54 cents per share had the workforce reduction costs not been figured in.


So their stock probably just went down because it appears they did badly, but they actually just trimmed the fat. If so, they should step out lean and profitable next quarter, and now would be a great time to invest.




RE: Time to buy Verizon stock
By acortez on 1/27/2010 1:54:46 PM , Rating: 2
Really with their high profile FiOS product posting poor performance?

http://www.philly.com/philly/blogs/inq-phillydeals...


RE: Time to buy Verizon stock
By acortez on 1/27/2010 1:56:48 PM , Rating: 2
RE: Time to buy Verizon stock
By XINFU4 on 1/27/10, Rating: -1
RE: Time to buy Verizon stock
By Oregonian2 on 1/27/2010 3:04:56 PM , Rating: 2
Not sure if growth being slower than forecast is necessarily "poor performance". Perhaps more "poor forecasting". Not exactly like the number of FiOS subscribers are dropping.

But it's not surprising that Comcast (etc) have an advantage in terms of delivering TV services in that they already have MUCH larger footprints than Verizon FiOS has. Installing FiOS is slow -- all new dig-installation of fiber cable, while my neighborhood had comcast cable from the getgo when the neighborhood was built to begin with.

I've had FiOS for internet (using it right now) for a couple years, and it's great (20Mbps/5Mbps). However I use DirecTV for TV (FiOS here initially had very limited HD when I made the choice -- but they've expanded locally by a huge amount and are a LOT more attractive now).

That said, I get snail-mail mailings from Verizon for FiOS TV once or twice a week (have "forever") as well as nice glossy flyers in the local newspaper. They're spending big bucks for advertising (interesting in that they're abandoning us to Frontier before long anyway).


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By fasfdhfd0000 on 1/29/10, Rating: 0
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By sdfasdgdhasdf on 1/30/10, Rating: 0
Hah
By TheRequiem on 1/27/10, Rating: -1
RE: Hah
By TheRequiem on 1/27/10, Rating: -1
RE: Hah
By DanNeely on 1/27/2010 11:15:29 AM , Rating: 3
The landline business is undergoing a slow motion implosion. The number of POTS customers in the US have plunged 25% from it's peak over the last few years and the rate's only accelerated since the recession hit as more customers are economizing with VOIP or by going wireless only. The FCC is already starting to look into how to plan the technology phase out. Handwaved ETA, a decadish from now.


RE: Hah
By gamerk2 on 1/27/2010 11:17:57 AM , Rating: 2
Call me next time power goes down city wide and ask me how well your phone is, because you can't. :D

Besides, landlines are cheaper, since it seems everyone suddenly lacks low priced wireless plans...


RE: Hah
By HrilL on 1/27/2010 11:48:23 AM , Rating: 3
Yeah you can. If you get VoIP service from an ISP like COX or Verizon Fios even they set it up with a UPS to power it for like 8 hours or so. I can't remember the last time I've lost power for more than 3 hours let alone 8. Maybe if you're using something you setup like Vonage or magic jack. But even then getting your own UPS for powering you modem router and one of your phones isn't that hard and should be a normal practice for anyone that actually thinks ahead.


RE: Hah
By Pedrom666 on 1/27/2010 12:28:45 PM , Rating: 2
Not to be picky, but he did say "City wide" which means the little battery/generator at the customer premise is not going to mean jack when the upstream connection is down. I think you would be hard pressed to show that any VoIP (or non POTS) connection is more reliable than POTS. POTS has many more years of investment in it.

Not sure where you live, but in the greater Washington DC metro area (where I am) we have lost power four times in the last 5 years that exceeded three hours. The most being almost 12 hours after a large storm took out a bunch of above ground lines in our area. During those times (two of which I had FiOS), I had power to the phone but no dial tone so the battery backup did no good at all. Note - Mobile phones (albeit AT&T) did function every time we tried.

No flaming or arguments, just my experience with the topic.


RE: Hah
By amanojaku on 1/27/2010 12:46:00 PM , Rating: 2
Your providers weren't doing their jobs, then. When I worked for companies that provided voice and data ALL of our facilities had backup power, and two kinds at that. We once ran on generator for three days while providing full service. That was one of the selling points of a service provider:

1) More bandwidth
2) Greater uptime (redundancy and power)
3) Better service
4) Lower prices

Maybe things have changed as companies cut costs.


RE: Hah
By amanojaku on 1/27/2010 12:28:32 PM , Rating: 2
quote:
I can't remember the last time I've lost power for more than 3 hours let alone 8.
It doesn't happen often, but it does happen.

http://en.wikipedia.org/wiki/Northeast_Blackout_of...

Of course, anyone making the land line argument is naive. During a power outage phone usage goes up and circuits become overloaded. Generator power doesn't mean squat if the system isn't designed to handle all the calls. At that point a land line is no better than a cell. Not to mention the ability to travel, say home from the office, with a cell when you would be forced to stay near a land line. I might have suggested texts instead of calls as texts are more lightweight, but the voice network is usually more robust than the data network, and there's no way to guarantee a text made it.

And you're right, you should have at least one UPS. I have three for a total of 3.1kVA and managed to ride out the 2003 blackout with ease. Good for charging the cell. ;-)


RE: Hah
By Oregonian2 on 1/27/2010 3:09:15 PM , Rating: 2
We've had power go out for a couple days in the past. Certainly more than the 8 hours of FiOS backup (and we do have FiOS, and that's one of my concerns with it). With traditional POTS our central office powers our phone indefinitely (and I've seen the redundant HUGE generators inside my central office, and they are incredibly impressive -- they said that even the local electric utility wanted them to provide them power during an outage -- a request they denied).


RE: Hah
By Mitch101 on 1/27/2010 1:02:54 PM , Rating: 2
Cell Phone?


RE: Hah
By eskimospy on 1/27/2010 11:15:46 AM , Rating: 2
Yeah! Take that Verizon Wireless! All your division did was exceed expectations! That should teach you to speak I'll of something tangently related to an Apple product!

Who cares? It's a cell phone company. Verizon and AT&T are both evil empires, the only difference is that AT&T is an incompetent evil empire.


RE: Hah
By HrilL on 1/27/2010 11:51:20 AM , Rating: 2
That is because they both came from the same evil phone company once known as Bell telephone. All the government did was make them split up into a few entities but they're basically the same.


RE: Hah
By weskurtz0081 on 1/27/2010 12:55:55 PM , Rating: 2
What makes them still basically the same?


RE: Hah
By mcnabney on 1/27/2010 1:41:04 PM , Rating: 2
Both operate very similar POTS networks that can deliver five-nines of service quality. VoIP and Wireless are nowhere near 99.999% uptime. They just aren't.

Verizon operates a true fiber "full service" network in select areas. AT&T operates a more limited uVerse package to a much wider area.

Now the difference is Wireless. First, Verizon only owns 55% of Verizon Wireless. It does manage it, but not all of the wireless earnings go to Verizon Telecom. Second, Verizon Wireless is a non-Union shop while AT&T has significant Union participation - mostly IBEW. Third, Verizon has always taken a more conservative approach, despite being a very progressive company - women and minorities are well represented in leadership and same-sex partners have full benefits. That means that VZW has always focused on basic, efficient, reliable service and products without following others into risky ventures. Sprint buying Nextel - which ran a competely different network - is a good example of stupid risk. AT&T has taken a lot more risks and ceded a lot of control, most obviously with Apple. That also means that they have only done the minimum to get by on the network side. They are paying for that now with severe network issues wherever iPhone users congregate. Instead of giving sweetheart deals to Apple (remember, Apple came to VZW first, but were turned down because Apple wanted all the control and most of the money) Verizon spends their earnings on battery and generator backups at their towers and fleets of mobile cell towers that are deployed at events that attract crowds. Neither is evil. Remember, they are just selling a service. The choice is the consumers.


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