Verizon revenue up slightly in third quarter

IDG News Service - Verizon Communications reported revenue of $27.3 billion for the third quarter of 2009, up 10.2% from a year earlier, but up only 0.6% if revenue from the January acquisition of competitor AllTel is taken out.

Verizon's net income for the quarter was $2.9 billion, down from $3.2 billion in the third quarter of 2008. Adjusted earnings per share were 60 cents, beating analyst expectations of 59 cents, according to Thomson Reuters.

Gains in the quarter were largely driven by growth in mobile customers and subscribers for Verizon's Fios fiber-based broadband and television service. Verizon CEO and Chairman Ivan Seidenberg cited free cash-flow growth that is 16% higher in 2009 than in 2008 as a highlight of the quarter.

Free cash flow for the quarter was $10.7 billion, up by $3.3 billion from the third quarter of 2008.

"Verizon continues to generate strong cash flow, which we have used in building the foundation for sustainable, long-term share-owner value," he said in a statement. "Even through the worst of the recession, we have continued to raise our dividend and to add new customers, expand markets and grow revenues based on the power and innovation of Verizon's wireless, broadband and global networks."

Verizon reported 89 million mobile customers at the end of the quarter, with 1.2 million net additions, excluding acquisitions and adjustments.

Verizon Wireless revenue was $15.8 billion for the quarter, up 24.4% over last year, or 4.9% on a pro forma basis. Wireless data revenue grew to $4.1 billion, up 28.9% on a pro forma basis.

Verizon's wireline division added 198,000 new Fios Internet customers and 191,000 new Fios television customers. The company now has 3.3 million Fios Internet customers, up 49.2%t over a year ago, and 9.2 million broadband subscribers, including DSL (Digital Subscriber Line).

Wireline revenue overall was $11.6 billion, down 4.8% from the third quarter of 2008.

Verizon also saved money by cutting about 5,000 employee and contractor jobs, 4,000 in its wireline division, during the quarter, said John Killian, executive vice president and chief financial officer. The company expects to cut another 4,000 jobs in the fourth quarter, he said.

The bad U.S. economy "continues to create headwinds" for the company, but Verizon is taking steps to keep costs down, Killian added.

"I'm confident that when the economy gets better, we will see improvement in our results," Killian said during a conference call.