There’s a reason Verizon can’t stop talking about 5G.
The next-generation cellular technology promises a massive speed boost, as well as a network that’s smart and responsiveness enough to connect thousands of different devices around us — so it’s a sexy topic.
What’s not sexy? Verizon’s fourth-quarter results. The mixed bag, with slightly better earnings and slightly disappointing revenue amid ho-hum customer growth, underscore the need for a shot in the arm.
Shares of Verizon fell 1.1 percent to $54.47 in premarket trading on Tuesday.
Verizon is in the midst of a transformation. Under new CEO Hans Vestberg, the former head of network supplier Ericsson, it’s all-in on its investment and focus on 5G and on improvements to its network. At the same time, it’s scaling back some of the bets made under his predecessor, Lowell McAdam, to invest in media projects.
The New York-based telecommunications company took a $4.6 billion charge to write down a massive portion of the value of its media assets, and last week announced that it’s cutting 7 percent of its work force in the media area, which include properties like Huffington Post, Techhnews and AOL.
It’s easy to see why Verizon wants to jump on the 5G bandwagon. The company has long leaned on its reputation of network superiority, and getting to the next advancement in networking technology would cement its position. The company also sees an opportunity to provide home broadband access to more consumers through 5G.
But Verizon isn’t the only player. Late last year, AT&T was the first to launch a mobile 5G service, and T-Mobile and Sprint are promising wide roll-outs this year.
The company added 1.2 million retail net new postpaid customers, or those who pay at the end of the month. It added 873,000 smartphone customers, but its total phone additions were 653,000, suggesting it lost a number of traditional “dumb” phone customers.
Verizon posted a fourth-quarter profit of $2.07 billion, or 47 cents a share, compared with a year-earlier profit of $18.78 billion, or $4.56 a share. Excluding the one-time charges, earnings came in at $1.12 a share, compared with 86 cents a year ago.
Revenue rose 1 percent to $34.3 billion.
Analysts had projected Verizon to earn $1.09 a share on revenue of $34.4 billion, according to Yahoo Finance.
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