NEW YORK (Reuters) - Verizon Communications Inc (VZ.N) on Tuesday reported quarterly revenue that exceeded analyst estimates as it added phone subscribers, and the company’s chief executive said it was not currently considering a large media acquisition.
Analysts have wondered whether Verizon, the No. 1 U.S. wireless carrier, will buy a media company as its rival AT&T Inc (T.N) tries to close on an $85.4 billion acquisition of Time Warner Inc TWX.N. The U.S. Department of Justice sued to block that deal late last year.
“I can say unequivocally, there is nothing going on right now with us considering a large media play,” Verizon Chief Executive Lowell McAdam said on a post-earnings conference call, adding that “being independent is a very good place to play for us right now.”
Verizon also said a tax-overhaul bill signed into law by U.S. President Donald Trump late last year would boost cash flow from operations in 2018 by about $3.5 billion to $4 billion.
McAdam said on the call that Verizon would provide more details on how it is investing in employees. Later on Tuesday, he told CNBC that Verizon’s non-executive employees, numbering about 155,000, will each get 50 shares of restricted stock.
When asked on CNBC about chipmaker Broadcom Ltd’s (AVGO.O) takeover attempt of rival Qualcomm Inc (QCOM.O), one of Verizon’s partners on 5G, or fifth-generation technology, McAdam said “the most important thing is to keep the innovation engine and research and development organisation intact” at Qualcomm. Analysts have said Broadcom would cut a big portion of Qualcomm’s R&D budget if it was successful in acquiring the company.
Verizon shares closed down 0.4 percent on the New York Stock Exchange at $53.23.
Net income attributable to Verizon was $18.7 billion, or $4.56 per share, in the fourth quarter through Dec. 31, up considerably from $4.5 billion, or $1.10 a share, a year earlier.
Excluding items such as the impact of the tax cuts, earnings per share were 86 cents.
Total revenue rose to $34.0 billion from $32.34 billion a year earlier.
According to Thomson Reuters I/B/E/S, analysts expected adjusted earnings per share of 88 cents on revenue of $33.26 billion.
The company added 431,000 phone subscribers who pay a monthly bill on a net basis. Analysts at Wells Fargo said in an earlier note that they expected 320,000.
Verizon added 47,000 Fios Internet connections in the quarter and lost 29,000 Fios video connections as consumers shifted to cheaper streaming services.
The company expects full-year revenue for 2018 to grow at a low single-digit percentage rate and service revenue growth to turn positive around the end of the year or early in 2019.
It also expects low single-digit percentage growth in adjusted earnings per share, excluding the impact of the tax reforms and a new accounting standard it has adopted.
Additional reporting by Liana Baker in San Francisco; Editing by Bernadette Baum and Tom Brown