Friday, November 17, 2017
Business

Verizon leads wireless industry, but still racks up record losses in fourth quarter

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NEW YORK — Verizon strengthened its position as the top dog of the wireless industry in the fourth quarter by raking in new subscribers and selling millions of Apple iPhones, but also posted a record loss.

The loss of $4.23 billion was mainly due to adjustments to the value of its pension funds and obligations, an annual routine for Verizon Communications Inc.

But even excluding the pension effects and the cost of repairing after Hurricane Sandy, the New York-based phone company missed Wall Street's earnings expectations, apparently because it attributed an unusually large amount of its profits to Vodafone Group, the British cellphone company that owns 45 percent of Verizon Wireless.

Verizon's loss for the October to December period compared with a loss of $2.02 billion a year earlier.

Revenue rose 6 percent to $30.05 billion from $28.44 billion, beating analyst forecasts of $29.8 billion, as Verizon added a record net of 2.2 million devices to its contract-based wireless plans.

The bumper quarter was fueled by the launch of the iPhone 5 on Sept. 21. Verizon activated 3 million of those, and 6.2 million iPhones of all kinds, another record for the company. IPhones accounted for two out of three smartphones activated, also the highest figure ever for Verizon.

IPhone sales are not an immediate benefit to the company, as it sells them at a big loss. It recoups the money over the life of a two-year contract, but the blockbuster sales helped curb its fourth-quarter loss.

Verizon Wireless revenue climbed 9.5 percent to $20 billion. On the wired side, operating revenue continued its long slide, falling 1.5 percent to $10 billion as households kept canceling their landlines.

To compensate, Verizon added a net 144,000 Internet customers and 134,000 pay-TV customers to its FiOS fiber-optic service, bringing the company to a total of 5.4 million FiOS Internet and 4.7 million FiOS Video customers.

For the year, Verizon Communications earned $875 million down from $2.4 billion in 2011. Annual revenue increased to $115.85 billion from $110.88 billion.

Verizon's report marks the debut for telecommunications companies this earnings season. Rival AT&T Inc. reports on Thursday.

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