Verizon Narrowly Misses Q4 Estimates, But Credits Trump Tax Bill For Profit Leap
Top wireless carrier Verizon, which is seen as a likely acquirer of more media assets in 2018, reported earnings that barely missed Wall Street estimates for the fourth quarter.
The company said a tax-overhaul bill signed into law by President Donald Trump in late December will result in a one-time reduction in net deferred income tax liabilities of about $16.8 billion.
Verizon estimated that the impact of the law to earnings per share for the year ended Dec. 31 was about $4.10.
Net income attributable to Verizon was $18.7 billion, or $4.56 per share, in the fourth quarter through Dec. 31, up considerably from $4.5 billion, or $1.10 a share, a year earlier. Excluding items such as the impact of the tax law, earnings per share were 86 cents, two cents shy of the consensus forecast from analysts, according to Thomson Reuters.
Revenue inched up to $34B from $32.34B in the year-ago quarter.
Verizon added 47,000 Fios internet subscribers in the period and lost 29,000 Fios video subscribers, which the company said reflected the shift from traditional linear video to over-the-top offerings. At the end of 2017, Verizon had 5.9 million Fios internet connections and 4.6 million Fios video connections.
Verizon shares were up in pre-market trading. On Monday, they established a new 52-week high, closing at $53.46, up 3%.
The company said that for 2018, it expects full-year revenue to grow at a low single-digit percentage rate and service revenue growth to turn positive around the end of 2018 or early 2019. It also expects low single-digit percentage growth in adjusted earnings per share, excluding the impact of tax reform and a new accounting standard it has adopted.
Executives are conducting a conference call with analysts to discuss the results. Check back here for updates.
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