Verizon's Q1 results down on expectations

From the beginning of the year until the unlimited plan was unveiled on February 12, Verizon lost a net 398,000 regular monthly phone customers, by far the most it had ever lost in an entire quarter.

NEW YORK (AP) - Verizon, the once-unstoppable cellphone leader in the US, lost key wireless customers for the first time, even as it brought back unlimited data plans to counter smaller rivals.

"It looks like Paul Marcarelli - the guy who used to say 'Can you hear me now?' for Verizon but became a Sprint pitchman past year - isn't the only one who's left Verizon lately", is how Paul R. La Monica puts it in his lede for CNNMoney.

Shares of Verizon fell almost 1.5 percent on the news. Verizon gained 209,000 post-paid phone customers in the period and AT&T lost 1.2 million.

Prior to the launch of those plans, Verizon had already seen a net loss of 398,000 postpaid phone customers; losses that began to reverse once Verizon finally buckled and returned to unlimited data. Canadian telecoms trade at 8 to 8.5 times Ebitda, he noted, while AT&T and Verizon both trade at less 6.8 times projected 2017 Ebitda.

Verizon Wireless abandoned its opponent and rolled out an unlimited data plan that was more expensive than plans from Sprint and T-Mobile. This pales with postpaid net of 640,000 a year ago and quarter upon quarter of million-plus adds before 2016.

Churn, or customer defections, among wireless retail customers who pay bills on a monthly basis, increased to 1.15 percent of total wireless subscribers, compared with the average analyst estimate of 1.03 percent, according to FactSet.




Verizon plans to merge the Yahoo business with its AOL unit and rename the combined company with the odd moniker of Oath.

"They badly missed on every important subscriber metric, and it just underscores that the wireless business is a severely growth-challenged business at the moment", said Craig Moffett, an analyst at MoffettNathanson in an interview.Net income attributable to Verizon fell to $3.45 billion, or 84 cents per share, in the first quarter ended March 31, from $4.31 billion, or $1.06 per share, a year earlier.

On Monday, John Legere leads the quarterly AT&T (T) and Verizon (VZ) bashing session known as the T-Mobile USA (TMUS) earnings call. "Verizon hopes the new spots reinforce the message that it still has the best performing wireless network as measured in a variety of surveys".

Verizon Chief Executive Lowell McAdam said he is open to deal talks with a variety of companies, including Comcast and Walt Disney Co.

There has also been speculation that Verizon could be interested in buying cable company Charter. Verizon's rivals are slated to report their latest results in coming weeks.

Can you hear that now, Wall Street?

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