Verizon Communications Inc on Tuesday reported quarterly revenue that exceeded analyst estimates as it added phone subscribers, and the company's chief executive said it was not currently considering a large media acquisition. Analysts have wondered whether Verizon, the No 1 US wireless carrier, will buy a media company as its rival AT&T Inc tries to close on an $85.4 billion acquisition of Time Warner Inc. The US Department of Justice sued to block that deal late last year.
"I can say unequivocally, there is nothing going on right now with us considering a large media play," Verizon Chief Executive Lowell McAdam said on a post-earnings conference call, adding that "being independent is a very good place to play for us right now."
Verizon shares were down 0.4 percent in morning trading at $53.26, after rising 1 percent in premarket trading. The company added 431,000 phone subscribers who pay a monthly bill on a net basis. Analysts at Wells Fargo said in an earlier note that they expected 320,000.
Verizon said a tax-overhaul bill signed into law by US President Donald Trump late last year would boost cash flow from operations in 2018 by about $3.5 billion to $4 billion. "We believe this will offer Verizon more flexibility, better dividend coverage and an ability to improve its credit metrics," Mark Stodden, senior vice president at Moody's, said in an email.
Net income attributable to Verizon was $18.7 billion, or $4.56 per share, in the fourth quarter through December 31, up considerably from $4.5 billion, or $1.10 a share, a year earlier. Excluding items such as the impact of the tax cuts, earnings per share were 86 cents.
Total revenue rose to $34.0 billion from $32.34 billion a year earlier. According to Thomson Reuters I/B/E/S, analysts expected adjusted earnings per share of 88 cents on revenue of $33.26 billion. Verizon added 47,000 Fios Internet connections in the quarter and lost 29,000 Fios video connections as consumers shifted to cheaper streaming services. The company expects full-year revenue for 2018 to grow at a low single-digit percentage rate and service revenue growth to turn positive around the end of the year or early in 2019.
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