Verizon Communications on Friday reported June-quarter adjusted earnings that missed estimates as it added fewer postpaid wireless phone subscribers than expected. VZ stock tumbled as the telecom lowered 2022 EPS guidance.
Verizon said it added only 12,000 postpaid wireless phone subscribers vs. analyst estimates for a 144,000 gain. In the year-earlier period, Verizon added 275,000 postpaid wireless phone customers.
"Verizon is struggling to differentiate itself. It's longstanding positioning as 'America's best network' is wearing thin," said Craig Moffett, analyst at MoffettNathanson. "With competitors that are willing (or forced) to stay highly promotional to sustain growth, Verizon's attempt to play the elder statesman role looks more and more to be a losing proposition."
For the second quarter, Verizon earnings came in at $1.31 a share, excluding items. Revenue rose 3% to $33.8 billion, edging by estimates.
A year earlier, Verizon earned $1.37 a share on revenue of $34.77 billion. Analysts had projected Verizon earnings of $1.33 a share on revenue of $33.77 billion.
Verizon stock tumbled 6.7% to close at 44.45 on the stock market today after slumping 2.9% Thursday.
In the Verizon earnings report, Q2 wireless service revenue rose 9% to $18.4 billion vs. analyst estimates of $18.39 billion.
Verizon Stock: 2022 Outlook Lowered
Also, Verizon updated financial guidance for full-year 2022. Verizon forecast adjusted EPS in a range of $5.10 to $5.25, down from earlier guidance of $5.40 to $5.55.
The telecom now expects adjusted EBITDA growth of minus 1.5% to flat vs. earlier guidance for adjusted EBITDA growth of 2% to 3%.
Verizon cut its outlook for wireless service revenue growth to a range of 8.5% to 9.5%, down from 9% to 10%.
Verizon stock holds a Relative Strength Rating of 60 out of a possible 99, according to IBD Stock Checkup. VZ stock has underperformed since its purchase of 5G spectrum delayed a buyback.
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Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
