Shares of Verizon (NYSE: VZ) dropped around 3.7% in Friday premarket trading, following a mixed first quarter earnings report. The wireless network operator posted stronger-than-expected earnings but tapered bullish interest as it cutback its full-year forecast for wireless revenue and profit growth.
The reaction to the forecast was partially offset by a smaller-than-expected loss of 36,000 monthly phone subscribers; which are deemed wireless networks’ most valued source of revenue. The smaller-than-expected loss was attested to popularity in bundled home broadband offerings on its expanding 5G network.
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Verizon said adjusted non-GAAP earnings for Q1 came in at $1.35 per share, up 3% from Q121 and in-line with the Street consensus. Group revenues rose just 2.1% from last year, amounting to $33.6B, just nudging past analyst estimates of around $33.55B. However, investors sold-off when management tipped that its full year adjusted earnings will likely come in at the lower end of its earlier forecast.
Looking further into 2022 then, Verizon announced its adjusted earnings would come in towards the bottom of its earlier expectation of a 2% to 3% growth rate. Again, the company reassessed revenue estimates, stating it would likely grow at the lower end of its 9% to 10% forecast.
CEO Hans Vestberg commented:
“Our operational performance in the first-quarter further positions Verizon for long-term growth and increases our competitive standing in mobility, nationwide broadband, the value market, and above the network business solutions and applications,”
“We continue to accelerate our C-Band network build with our goal of reaching at least 175 million people by the end of the year”
VZ shares are currently trading at a daily loss of 5.5%, down 9.5% year-over-year.
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Oliver is a financial writer and analyst specialising in the US stock market, with years of personal experience in understanding micro/macroeconomic structures, market trends and fundamental analysis.