Verizon Revenue, Profit Both Jump Again
Fueled by growth of wireless and FiOS connections, Verizon Communications on Tuesday reported increases in overall revenue and profit for its third quarter compared to the same quarter last year.
Total operating revenue in third-quarter 2015 was $33.2 billion, a 5 percent increase over $31.6 billion in third-quarter 2014. Profit totaled $4.2 billion, compared to $3.8 billion a year ago.
“Verizon Wireless posted another quarter of quality connections growth – even better than in the second quarter – while maintaining high customer loyalty and profitability,” said Lowell McAdam, Verizon’s chairman and CEO. “Meanwhile, Fios customer growth also improved from the previous quarter. We expect future revenue growth from mobile over-the-top video, including digital advertising, and the Internet of Things.”
Verizon says its acquisition of AOL in June is playing a key role in its growth strategy. In the first nine months of 2015, Verizon invested about $22 billion in spectrum licenses and capital for future network capacity, in addition to the $4 billion AOL acquisition. Over that same time, the company maintained its leverage ratio and returned more than $11 billion to shareholders in the form of dividends and share repurchases.
For the third quarter, Verizon Wireless reported $23 billion in revenue, up 5.4 percent year over year. While service revenue was down 4.1 percent, at $17.6 billion, equipment revenue nearly doubled to $4.3 billion as more customers chose to buy new devices with installment pricing.
Verizon Wireless ended the quarter with 110.8 million retail connections, up 4.3 percent year over year, and 105 million retail postpaid connections, a 4.9 percent increase year over year. 4G devices now encompass more than 76 percent of the retail postpaid connections base, with the LTE network handling about 89 percent of total wireless data traffic in the third-quarter, an increase of about 75 percent in network data megabytes in the past year.
In the wireline segment, consumer revenues totaled $4 billion, up 2.8 percent compared to third-quarter 2014. Total Fios revenue grew 7.5 percent, to $3.4 billion. Verizon added 114,000 net Fios Internet connections and 42,000 net Fios video connections during the quarter.
New revenue streams from the Internet of Things (IoT) totaled about $175 million in third-quarter 2015 and about $495 million year to date. In August, Verizon launched hum, a telematics service that creates a smart, connected driving experience with an addressable market of 150 million vehicles in the United States.
