Verizon Communications Inc.’s
VZ -0.38%
fourth-quarter profit inched up as the company replaced revenue lost from its digital-media spinoff with new customers under pay-as-you-go wireless giant TracFone.
Verizon, the largest mobile network operator in terms of subscribers, also added 553,000 postpaid phone connections in the December quarter, an increase that trailed additions at competing carriers. Rival
AT&T Inc.
T -1.01%
earlier this month reported preliminary results showing a net gain of 880,000 postpaid phone connections in the final three months of 2021, while
T-Mobile US Inc.
added 844,000.
Cellphone carriers often push customers toward postpaid agreements, which represent a reliable stream of revenue. Verizon counted a small percentage of its subscribers on prepaid billing plans until the end of last year, when the company closed its purchase of TracFone Wireless for $6.25 billion. Just over one-fifth of Verizon’s consumer wireless retail connections were prepaid at the end of December.
The acquisition further consolidated a concentrated market for cellular services. It also helped stabilize revenue after the decision earlier in 2021 to sell most of AOL, Yahoo and other digital-media properties to private-equity firm
Apollo Global Management Inc.
for $4.25 billion. Verizon kept a 10% stake in the online unit.
For the current year, Verizon forecast organic wireless service revenue growth of at least 3%. The company said its regular capital spending this year will range between $16.5 billion and $17.5 billion. It plans to spend an additional $5 billion to $6 billion dedicated to network upgrades supporting its C-band spectrum deployments, up from about $2.1 billion last year.
AT&T and Verizon have faced pushback from U.S. air-safety regulators in recent months as they expand their fifth-generation networks to support C-band signals. Verizon has said that temporary limits on C-band cellular signals near airport runways won’t prevent it from covering 100 million people with the high-speed service by the end of March.
Fourth-quarter net income attributable to Verizon rose to $4.61 billion from $4.59 billion a year earlier. On a per-share basis, Verizon’s profit stayed flat at $1.11.
Quarterly revenue slipped 1.8% to $34.07 billion, reflecting the divestiture of the media business. Wireless-service revenue grew 6.5% to $17.76 billion.
Verizon said its total connections—a figure that includes connected devices like smartwatches and tablets but excludes phone service resold through partners like
Charter Communications Inc.
and
Comcast Corp.
—ended the year at 115.4 million. That tally reflected roughly 20 million new TracFone customers.
Verizon shares rose 0.5% in premarket trading.
Write to Drew FitzGerald at [email protected]
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
For all the latest Technology News Click Here
For the latest news and updates, follow us on Google News.
