Verizon Profit Gains Even as Wireless Slows

Verizon Communications reported a rise in quarterly net profit and higher-than-expected growth in its FiOS television and high-speed Internet business.

Don Ryan / AP

The No. 2 U.S. phone company said Tuesday quarterly profit rose to $1.2 billion, or 43 cents a share, from $1.1 billion, or 37 cents a share, in the same quarter a year earlier.

Earnings per share before items fell to 61 cents from 62 cents. That was a penny below the average analyst forecast of 62 cents, according to Reuters Estimates.

"In this environment I think it's fine," said analyst Christopher King at Stifel Nicolaus Telecom Equity Research, referring to the small miss. "There were huge FiOS net adds. That's certainly the main headline, exceeding expectations."

Verizon said its FiOS TV and Internet service, which competes with cable service providers, grew at its fastest pace ever. It reported 303,000 net new FiOS TV customers and 282,000 FiOS Internet customers for the quarter, helping to offset the loss of traditional wireline customers.

The FiOS numbers also helped the market look past slightly slower growth in subscribers at Verizon Wireless, owned by Verizon and Britain's Vodafone Group.

Verizon Wireless added 1.4 million net subscribers in the quarter excluding its Rural Cellular acquisition, compared with an average analyst forecast of around 1.5 million. It added 2 million in the year-earlier quarter.

Total revenue rose 3.4 percent to $24.6 billion from $23.8 billion.

Verizon closed its acquisition of rural wireless provider Alltel in early January, creating the biggest U.S. wireless provider by surpassing AT&T in terms of subscribers.

Verizon shares were essentially unchanged in premarket trade at $31, compared with their close on Monday at $30.99.

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