Verizon reports strong wireless revenue growth

Verizon Wireless reported a solid second quarter, posting a substantial revenue increase and giving parent company Verizon Communications a bright spot as the company's wireline revenues declined. Indeed, Verizon Communications said it would cut an additional 8,000 jobs in its wireline division. Verizon Communications reported income of $1.48 billion, down 21 percent from $1.88 billion a year earlier. (Verizon Wireless is a joint venture between Vodafone and Verizon Communications.)

[1]Here's a breakdown of some of Verizon Wireless' key metrics:

Revenue: Verizon Wireless' revenues totaled $15.5 billion, up 27.7 percent over the second quarter of last year, when Verizon had $12.1 billion in wireless revenues. Service revenues were $13.3 billion, up 27.2 percent over the year-ago quarter, when Verizon had $10.5 billion in service revenue. Data revenue surged to $3.9 billion, up 52.6 percent over the second quarter of last year, when Verizon had around $2.6 billion in data revenue. 

Net adds: The carrier recorded 1.1 million net subscriber additions in the quarter, down from the 1.3 million net adds it recorded in the first quarter, and notably less than the 1.5 million net adds it scored in the second quarter of last year. Verizon's subscriber base now stands at about 87.7 million.

Churn: Verizon's churn for the quarter was 1.37 percent, an improvement from the 1.47 percent churn it had in the first quarter, but up 22.3 percent from the 1.12 percent churn the carrier had in the second quarter of last year. Verizon COO Denny Strigl said that churn was primarily impacted by the loss of business customers amid the recession.

ARPU: Total ARPU was $51.10, down 0.8 percent from $51.53 in the second quarter of last year, but up from $50.74 in the first quarter. Data ARPU came in at $14.96, up 18.9 percent over the second quarter of last year, and up from $14.16 in the first quarter.

Alltel acquisition: Verizon CFO John Killian said that nearly half of Alltel's former subscriber base has been transferred to Verizon's billing system. He said that the carrier remains on track to convert all former Alltel customers by the end of October.

Straight Talk: Another item of interest that came up during Verizon's earnings conference call was TracFone Wireless' prepaid, unlimited Straight Talk plan, which uses Verizon's network. Strigl declined to elaborate on the terms of the deal, and said that Verizon would continue to focus on the postpaid market, but would not avoid prepaid or reseller strategies. He also said that Verizon has the flexibility to pull its brand off of the service at any time.

For more:
- see this release [2]
- see this WSJ article [3] (sub. req.)
- see this Reuters article [4]

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Verizon weathers economy, adds 1.3M net subs [6]
Verizon [7] mobile data revenues grow 44% in 2008
Verizon Wireless has 1.4M net adds in Q4 [8]