Verizon Communications (VZ) posted weaker-than-expected second quarter earnings Friday, while trimming its full-year profit forecast, as price hikes look to have slowed wireless subscriber growth.
Verizon said adjusted non-GAAP earnings for the three months ending in June were pegged at $1.31 per share, down 4.4% from the same period last year and just shy of the Street consensus forecast of $1.33 per share. Group revenues, Verizon said, were essentially flat to last year at $33.8 billion, and marginally ahead of analysts' estimates of a $33.77 billion tally.
Verzion's post-paid additions for the quarter were pegged at 12,000, an improvement from the 36,000 lost over the first three months of the year but well shy of the Refinitiv forecast of 150,800.
Looking into the 2022 financial year, Verizon said adjusted earnings would come in between $5.10 to $5.25 per share, down from its previous estimate of between $5.40 to $5.55 per share. The group also cut its wireless revenue growth forecast to a range of between 8.5% and 9.5% for the year.
"As the market leader, in a very competitive industry, we are determined to improve our operational and financial performance for the second half of the year,” said CEO Hans Vestberg. "With our network-as-a-service foundation, our new consumer mobility plans, and recent pricing actions, we are being deliberate in our decisions to improve our profitable growth opportunities today and into the future."
Verizon shares were marked 7.9% lower early afternoon Friday trading following the earnings release to change hands at $43.90 each, the lowest in at least five years.
Earlier this week, rival AT&T Inc. (T) had better-than-expected second quarter earnings but lowered its full-year cash flow forecasts as it ramps-up investment in its expanding 5G network.
Looking into the second half of the year, AT&T said it's lowering its full-year free cash flow forecast by $2 billion, to around $14 billion, but boosting its mobility revenue growth guidance to between 4.5% and 5%. The group also reiterated its full-year profit forecast of adjusted earnings between $2.42 and $2.46 per share.
