Verizon announced a net income for the fourth quarter of 2013 of $5.07 billion. The wireless carrier was helped by the continued increase of wireless devices into its network.
Verizon’s earnings beat expectations of Wall Street analysts and its stock edged up in Tuesday premarket trading. The largest cell phone carrier in the U.S. had a profit equal to $1.72 a share. During the same period one year ago, the company reported a loss of $4.23 billion equivalent to $1.48 a share.
Revenue increased for the recently ended quarter to $31.06 billion from $30.04 billion one year ago. Analysts that were polled expected the profit to be 62 cents a share on revenue of $31.04 billion.
Verizon service revenue increased by 8% to end the quarter at $17.7 billion, while the company added more than 1.7 million net wireless connections in the three month period ending December 31, 2013, excluding adjustments and acquisitions. Of the 1.7 million total, more than 1.6 million were connections involving monthly retail service contracts.
The wireline division of the company, which is the division that provided landlines within the company’s FIOS TV and Internet services, also enjoyed growth. Consumer revenues in that division were up over 6% to end the quarter at $3.8 billion, as consumer revenue related to FIOS increased by 15% to close the quarter at $2.8 billion.
Shares of the company were up by 45 cents to $48.81 during premarket trading on Tuesday prior to the opening bell sounding on Wall Street.
Investors were worried that the market leader, which has to pay $130 billion for the 45% share of Vodafone in a joint venture, would cut prices as T-Mobile offered special discounts and drew responses from both Sprint and AT&T.
However, Verizon’s ability to exceed estimates in profit and subscribership suggests that it did not offer deep discounts to maintain its customers from switching to one of its three main rivals.
Profit margin for Verizon was 47% during the quarter based upon earnings prior to taxes, interest, amortization and depreciation. Analysts had predicted profit margin would be 46%.
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