Verizon said its fourth-quarter earnings rose by 3.9 percent to $1.07 billion, driven by the robust performance  of the company's wireless business, which it jointly owns with the Vodafone Group. Quarterly revenue rose by 5.5 percent from one year earlier to $23.8 billion.
Verizon Wireless "had another strong quarter of customer growth, with 2 million total net additions" -- 1.9 million of which were retail post-paid customers, noted CFO Doreen Tobin during a conference call with financial analysts. "We now have 61 million retail post-paid subscribers," she added.
Despite concerns about the U.S. economy, Tobin told analysts she has not changed her sales expectations through January. "Obviously we are monitoring numerous metrics very closely and at this point we don't see any material changes," Tobin said. "We are very confident in our outlook for 2008."
High-Value Customers
Though it added 2 million subscribers in the fourth quarter, Verizon appeared to lose ground to rival AT&T Wireless, which grew its own subscriber base by 2.7 million customers during the same period. However, Verizon's net gain of 1.6 million customers for its post-paid plan easily exceeded AT&T's comparable post-paid numbers.
The higher value of Verizon's post-paid gains becomes evident when the wireless revenue numbers of the rivals are compared. Verizon Wireless grew revenue by 13.3 percent to $11.44 billion during the fourth quarter, beating the comparable $11.36 billion figure posted by AT&T Wireless. Verizon also was able to claim bragging rights for having a customer turnover rate of just 1.2 percent. By comparison, AT&T's churn rate in the fourth quarter was 1.7 percent.
Verizon's results were also boosted by a 53 percent rise in data revenues for the quarter. Company executives said about 52 percent of the company's retail customers at the end of 2007 were equipped with broadband-capable devices, including the new BlackBerry Pearl, Samsung SCH-i760 and Palm Treo 755p.
"About 74 percent of our retail customers are data users," Tobin noted. "We see enormous potential for growth in wireless data for years to come" and the company is "well positioned to take advantage of this huge growth opportunity."
The Road Ahead
Moving forward, Verizon will be challenged to deliver on its plans to foster new technologies on its network . For example, it expects to begin trials this year of a new 4G (fourth-generation) mobile broadband technology called LTE (Long Term Evolution). (continued...)
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