Verizon Communications Inc. (VZ) said the company delivered strong third quarter results with an increased cash flow, wireless service revenue growth, and the most Fios Internet net adds since fourth 2014. The company said its performance was highlighted by increases in wireless service revenue and total Fios Internet net additions. Also, the company revised earnings guidance upward for the year.
On an adjusted basis, third-quarter earnings per share, excluding a special item, was $1.25, compared to $1.25, a year ago. The company estimates that third-quarter 2020 earnings results included approximately negative 5 cents of COVID-19-related net impacts. On average, 21 analysts polled by Thomson Reuters expected the company to report profit per share of $1.22, for the quarter. Analysts’ estimates typically exclude special items.
Third quarter total consolidated operating revenues were $31.5 billion, down 4.1 percent from previous year. The company said this decline was due to lower customer activity and the timing of certain device launches. Analysts expected revenue of $31.59 billion, for the quarter.
Total Verizon Consumer revenues were $21.7 billion, a decrease of 4.3 percent year over year, primarily driven by a significant decrease in wireless equipment revenue due to reduced customer activity. Consumer wireless service revenues were $13.4 billion, a 0.7 percent decrease year over year.
Total Verizon Business revenues were $7.7 billion, down 1.7 percent year over year. Business wireless service revenues were $3.0 billion, a 4.9 percent increase year over year, primarily driven by Public Sector and Small and Medium Business. Total Verizon Media revenues were $1.7 billion, down 7.4 percent year over year.
In third-quarter 2020, Consumer reported 136,000 retail postpaid net additions, including 142,000 phone net additions and 258,000 postpaid smartphone net additions. Consumer recorded 139,000 Fios Internet net additions, an increase from 30,000 Fios Internet net additions in third-quarter 2019, and 144,000 Fios Internet net additions across Consumer and Business, the most since fourth-quarter 2014. Business recorded 417,000 retail postpaid net additions, including 141,000 phone net additions. Wireless registered 553,000 retail postpaid net additions, including 283,000 phone net additions and 428,000 postpaid smartphone net additions.
Verizon Communications ended third-quarter 2020 with free cash flow (non-GAAP) of $18.3 billion, an increase of $3.9 billion year over year, and $9.0 billion of cash on hand.
For full-year 2020, the company now expects adjusted earnings per share growth of 0 to 2 percent, an update from prior guidance for adjusted EPS growth of between negative 2 percent to 2 percent. Capital spending is now anticipated to be at the higher end of the guided range of $17.5 billion to $18.5 billion.
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