Verizon profit grows 16.43% in 2008

NEW YORK – For all of 2008, Verizon Communications Inc. (NYSE: VZ) posted a profit of $6.43 billion, a 16.43 percent increase from its 2007 profit of $5.52 billion, on full-year revenue that grew 4.2 percent to $97.4 billion. Earnings per diluted common share rose to $2.26 from the preceding year’s $1.90 per share.
“Verizon has shown that it is able to compete effectively in this economic environment,” Chairman and CEO Ivan Seidenberg said in a statement accompanying yesterday’s report.
The company’s Wireline division – which includes Verizon Business, as well as Verizon Telecom – “reported record growth in the number of new customers of FiOS TV and FiOS Internet, and it continued to increase sales of enterprise strategic services year over year,” Verizon said. The company’s fiber-optic service (FiOS) saw net growth of 303,000 FiOS TV customers and 282,000 FiOS Internet customers. Meanwhile, strategic business services revenue rose 8.4 percent compared with 2007.
Verizon’s Wireless division posted a 12.3-percent in annual revenue, lead by data revenue, which rose 41.4 percent compared with 2007, the company said. “Organic [subscriber] growth totaled 1.4 million net customer additions, essentially all of which were retail,” the company said. Total wireless customers increased to 72.1 million at year’s end. The retail customer base increased 9.9 percent last year to 70.0 million – the most of any U.S. wireless brand – and this month rose again, to more than 80 million, as the company completed its acquisition of Alltel.
“We grew profits and maintained strong cash flows throughout 2008,” the CEO said. “In the fourth quarter, we continued to produce top-line growth, fueled by strong sales volumes for broadband, wireless and strategic business services.”
For the three months ended Dec. 31, the company posted a profit of $1.23 billion, a 15.21 percent increase from the year-ago $1.07 billion, on fourth-quarter operating revenue that rose 3.4 percent to $24.6 billion. Earnings per diluted common share rose to 43 cents from the 2007 fourth quarter’s 37 cents, although they fell compared with the 2008 third quarter’s 59 cents per share. (READ MORE)
Results for the quarter just ended included fourth-quarter after-tax expenses of $490 million, or 17 cents per share – $424 million, or 15 cents per share, for severance and other layoff-related costs; $35 million, or 1 cent per share, in merger-integration costs; and $31 million, or 1 cent per share, for other-than-temporary declines in the fair value of certain investments – compared with the 2007 fourth quarter’s 24 cents per share in similar expenses, the company said. Excluding those costs, the company’s fourth-quarter earnings dipped to 61 cents per diluted share from the year-ago 62 cents per share.
“The Verizon story in 2008 was one of customer growth and product innovation, based on the strategic technology and broadband infrastructure investments we have made year after year,” Seidenberg said. “We have built a solid foundation to continue to create value for our customers and shareholders in 2009 and beyond.”
Verizon Communications Inc. (NYSE: VZ), a Dow 30 company, delivers broadband and other communications services through two divisions: Verizon Wireline, which includes the Verizon Business and Verizon Telecom segments; and Verizon Wireless. The company has a staff of nearly 224,000. For more information about Verizon and its Rhode Island operations, visit www.verizon.com/ri.