Verizon reported Q2 revenue of $22.7 billion, up 25.6 percent from second quarter 2005. Reported quarterly earnings were $1.6 billion, or 55 cents per diluted share, compared with $2.1 billion, or 75 cents per share, in the second quarter 2005 — including 9 cents per share in special items for severance and related pension and benefits charges, and for employee relocations and merger integration costs.
Some highlights for the quarter:
Verizon Wireless
- Added 1.8 million net customers in the second quarter 2006, for a total of 54.8 million customers nationwide, representing a 15.8 percent increase in total customers from the end of the second quarter last year. During the past 12 months, the company added nearly 7.5 million net customers.
- All of the net additions in the quarter and almost all of those in the past 12 months were retail customers — that is, businesses and consumers directly served and managed by Verizon Wireless and who buy Verizon Wireless- branded service, rather than customers of the company’s resellers.
- Total churn was a record-low 1.13 percent, and churn among the company’s retail postpaid customers was 0.87 percent, another record.
- Verizon Wireless revenues grew 18.0 percent year-over-year to $9.3 billion in the second quarter 2006, driven by continued strong customer growth and demand for data services.
- Wireless data revenues topped $1.0 billion for the first time in a quarter. Wireless data revenues accounted for nearly 12.9 percent of total wireless service revenues.
Wireline
- There were 440,000 net new broadband connections, which include both DSL and the FiOS fiber-based access service.
- FiOS Internet customers accounted for 111,000 of the new broadband additions and now make up 375,000 of the company’s 6.1 million total wireline broadband connections, which have increased 47.9 percent compared with the second quarter 2005. FiOS data services are becoming increasingly available for sale in 16 states, as Verizon’s FTTP network passed a total of 4.5 million premises by mid-July 2006 and is on target to pass 6 million premises by year- end.
- Penetration of FiOS Internet service now stands at 12 percent across all markets. In markets where Verizon has been selling FiOS data services for at least a year, the average penetration rate was 15 percent at the one-year mark, well on the way toward achieving the company’s goal of 30 percent penetration in five years.
- Earnings dilution from FiOS data and video deployment was 7 cents per share in the second quarter 2006 and is expected in the range of 28 cents per share to 30 cents per share for the full year.
- Verizon now has 485,000 customers who receive a Verizon DIRECTV bundle, adding a company-record 70,000 net new customers in the quarter.
- Total switched access lines in service — not including wireline broadband connections — were 47.0 million at the end of the second quarter 2006, a 7.4 percent decline compared with the second quarter
2005. - Total wireline operating revenues were $12.8 billion in the second quarter 2006, an increase of 35.3 percent compared with the second quarter 2005 on an adjusted basis (non-GAAP) excluding revenues from operations sold in 2005. On the same adjusted basis, total wireline operating expenses were $11.6 billion in the second quarter 2006, a 40.1 percent increase compared with the second quarter 2005.
Verizon Business
- The company is ahead of plan to achieve its 2006 target of $550 million in synergies from the MCI merger. By the end of the second quarter, approximately $200 million in synergies were realized, at a rate that will continue to ramp up through the remainder of the year.
- Verizon Business operating revenues increased 1.6 percent over Q1, on a pro-forma basis, to $5.1 billion in the second quarter 2006.
- Verizon’s total debt at the end of the second quarter 2006 was $42.4 billion, compared with $38.3 billion at the end of 2005. The increase was primarily due to the addition of MCI’s debt as a result of the merger.
http://www.verizon.com