Verizon Communications 
report solid results for Q4 2010, driven by wireless, FiOS and strategic enterprise services. On a consolidated basis, Verizon’s total operating revenues were $26.4 billion in fourth-quarter 2010, a decrease of 2.6 percent compared with fourth-quarter 2009. Last year’s results included revenues from operations that have since been divested. On a comparable basis (non-GAAP), fourth-quarter 2010 total operating revenues increased $592 million, or 2.3 percent, compared with fourth-quarter 2009.
On an annual basis, Verizon reported 90 cents in 2010 EPS, compared with $1.72 (as adjusted) in 2009.
Cash flow from operations totaled $33.4 billion in 2010, compared with $31.4 billion in 2009. Capital expenditures totaled $16.5 billion in 2010, down $400 million from 2009. For 2010, free cash flow (non-GAAP; cash flow from operations less capital expenditures) totaled $16.9 billion, a 16.4 percent year-over-year increase.
“Verizon ended 2010 with strong results, driven by solid execution across all our businesses,” said Verizon Chairman and CEO Ivan Seidenberg. “The fourth quarter capped a strong second half of the year, resulting in improved earnings, solid momentum and an even stronger balance sheet. Verizon Wireless produced another quarter of impressive growth, with record-high profitability, as we continue to drive higher smartphone adoption and data use. Following another solid quarter in our wireline businesses, we are optimistic about opportunities to continue to expand wireline margins.”
Some highlights for the quarter:
Wireless
Verizon Wireless added 872,000 retail postpaid customers, and 803,000 total retail customers, which includes a decrease of 69,000 retail prepaid customers. These additions exclude acquisitions and adjustments.
At the end of the fourth quarter, the company had 87.5 million retail customers, which represented 93 percent of the company’s wireless customers.
The company also added 152,000 reseller customers in the fourth quarter.
The company had a total of 94.1 million customers at the end of the fourth quarter. In addition, the company had 8.1 million other connections – such as machine-to-machine and telematics. This was an increase of 186,000 net other connections in the quarter, and brought the number of total wireless connections to 102.2 million at year-end 2010.
At year-end 2010, 26 percent of Verizon Wireless’ retail postpaid customer base had smartphone devices, up from 15 percent at year-end 2009. In fourth-quarter 2010, more than 75 percent of Verizon Wireless’ postpaid net adds were smartphones.
Retail postpaid churn remained low at 1.01 percent. Total retail and total customer churn levels were 1.37 and 1.34 percent, respectively. All churn levels improved year over year and sequentially.
In the fourth quarter, total data revenues were 37.1 percent of all service revenues, up from 31.8 percent in the fourth quarter 2009.
During the fourth quarter, Verizon Wireless customers sent or received more than 180 billion text messages. Customers also sent nearly 4.5 billion picture/video messages and completed more than 20 million music and video downloads from Verizon Wireless.
Wireline
Verizon added 197,000 net new FiOS Internet customers and 182,000 net new FiOS TV customers. By year-end, Verizon had 4.1 million FiOS Internet and 3.5 million FiOS TV customers.
FiOS Internet penetration (customers as a percentage of potential customers) was 31.9 percent by the end of the quarter, with the product available for sale to 12.8 million premises. This compares with 28.3 percent and 11.6 million, respectively, at year-end 2009.
FiOS TV penetration was 28.0 percent by the end of the quarter, with the product available for sale to 12.4 million premises. This compares with 24.7 percent and 11.1 million, respectively, at year-end 2009.
FiOS revenues generated approximately 53 percent of consumer wireline revenues in fourth-quarter 2010, compared with approximately 50 percent in third-quarter 2010.
Total wireline broadband and video revenues – including FiOS Internet, FiOS TV and HSI (DSL-based high-speed Internet) – were $1.8 billion in the quarter, up 18.4 percent from fourth-quarter 2009.
Consumer revenues grew 1.6 percent compared with fourth-quarter 2009. Consumer ARPU for wireline services was $88.85 in fourth-quarter 2010, up 10.7 percent compared with fourth-quarter 2009. ARPU for FiOS customers is more than $146.
Global enterprise revenues totaled $4.0 billion in the quarter, up 1.3 percent compared with fourth-quarter 2009. Sales of strategic enterprise services – such as security and IT solutions, as well as strategic networking – increased 7.5 percent compared with fourth-quarter 2009 and now represent approximately 44 percent of global enterprise revenues.
Broadband connections totaled 8.4 million at the end of the fourth quarter 2010, a 2.8 percent year-over-year increase. This is a net increase of 52,000 from the third quarter 2010, as the increase in FiOS Internet connections more than offset a decrease in HSI connections.
As of year-end 2010, the FiOS network passed 15.6 million premises, or approximately 60 percent of Verizon’s domestic wireline footprint following the close of the Frontier transaction on July 1, 2010.
The wireline workforce totaled 92,300 at year-end 2010, a decline of about 16,000 year over year, primarily as a result of incentive offers that have led to voluntary separations.
http://www.verizon.com
