Verizon Communications forecast annual profit above estimates on Tuesday after strong demand for its wireless plans and Black Friday promotions helped the U.S. carrier post its highest quarterly subscriber additions in nearly two years.
The telecom firm added net 449,000 monthly bill-paying wireless phone subscribers in the last three months of 2023, blowing past estimates of 223,800 additions, according to Factset.
Shares of the New York-based telecom company rose nearly 3% in trading before the bell.
The company – whose services typically cost more than rivals – has seen strong adoption for its customizable “myPlan” that was launched in May last year. To make the plan more attractive, Verizon is also offering subscriptions to Netflix and Warner Bros Discovery’s Max streaming service in some bundles.
Verizon said it expects adjusted profit in 2024 to be between $4.50 and $4.70 per share, the midpoint of which was higher than the estimates of $4.59, according to LSEG data.
Its fourth-quarter results also benefited from promotions for the Black Friday shopping event and the release of the iPhone 15 series, which drove up smartphone upgrade activity.
The company’s consumer segment reported 318,000 wireless retail postpaid phone net additions in the quarter, after three consecutive quarters of losses.
That, as well as price hikes implemented over the course of last year, helped Verizon post revenue of $35.1 billion, which topped estimates of $34.64 billion.
Net loss was $2.6 billion, or 64 cents per share, compared with a profit of $6.7 billion, or $1.56 per share, a year earlier. The company took a $5.8 billion write-down in the quarter as it cut the value of its declining wireline business, among other charges.
Full-year free cash flow, a metric closely watched by investors to help determine dividend payouts, came in at $18.7 billion, an increase from $14.1 billion in 2022.
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