Verizon Communications Inc. The second major wireless carrier in the United States disappointed about its earnings this week, as the company cut its full-year financial forecast on Friday.
Shares are down nearly 5% in pre-market trading.
Realized earnings per share is $1.31, down from $1.37 a year earlier, and a penny below the FactSet consensus, which was $1.32. Verizon said fourth-quarter earnings included a $435 million loss before tax from special items.
Verizon’s revenue was $33.8 billion, roughly flat from the previous year, while analysts tracked by FactSet were modeling at $33.7 billion.
The company recorded a total of 12,000 postpaid phone network additions in the last quarter but noted that 215,000 of those wireless losses were in its consumer business. Verizon saw its rate of postpaid phone sales in consumer wireless retail coming in at 0.93%.
Verizon lowered its full-year forecast and now expects 8.5% to 9.5% growth in wireless services revenue as well as $5.10 to $5.25 in earnings per share.
During its first-quarter report, Verizon said it expects to reach toward the “lower end” of the guidance ranges it previously provided for earnings and adjusted earnings per share. The ranges for these guidance require 9% to 10% revenue growth plus $5.40 to $5.55 in adjusted EPS.
Verizon’s results came after AT&T Inc. T,
He submitted a mixed report the day before. AT&T saw strong growth in its postpaid phone network additions and indicated that pricing changes had a positive impact, but management also noted some changing consumer behavior in the wake of worsening economic conditions, and the company lowered its free cash flow forecast.
Read: AT&T Earnings ‘Really Good’ Despite Share Sale, Analyst Says
AT&T revealed that some customers are becoming slower with their phone payments in light of the economy, one factor that has contributed to lower expectations of free cash. At the same time, AT&T noted that bad debt expenses were no higher than they were before the pandemic, indicating management that the company expects customers to continue to pay their bills even if that’s slightly slower than AT&T’s growth accustomed to during healthy economic times last year.
Verizon shares have lost 8% over the past three months as the S&P 500 SPX,
It has decreased by 6%.