Verizon (VZ) Quarterly Earnings: Some Traction In TV

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Verizon’s (VZ) revenue rose 6% to $23.3 billion. Adjusted operating income was up 15% to 4.2 billion.

As expected, the company did well in its wireless business. Total wireless customers rose 13% to 52.1 million. The customer churn rate was below 1.1%.  But, the churn rate was up slightly and the rate at which the company added net new wireless customers dropped 26%!

The company’s wireless business shrank by 1% as the company loses customer to VoIP. Residential wireline revenue was off from $29.4 billion in the quarter a year ago to $26.3 billion this year.

The surprise was that Verizon is starting to show some life in its competition with the cable companies. Sales of FiOS TV continued to accelerate as Verizon Telecom added a net of 167,000 new FiOS TV customers in the second quarter 2007. Net customer additions averaged about 2,600 per business day in the quarter. The company had a total of 515,000 FiOS TV customers as of the end of the second quarter 2007 — an addition of 460,000 FiOS TV customers since the end of the second quarter 2006.

Now, if only FiOS revenue could start to offset landline losses.

Douglas A. McIntyre