Summary
Verizon Communications Inc. (VZ) filed an 8-K on July 26, 2010, reporting on their Q2 2010 performance and outlook for the remainder of the year. A key highlight from the filing is the company's performance in the first half of 2010, where adjusted earnings per share (EPS) was $1.13. This figure notably excludes approximately $0.12 of EPS impact from assets spun off to Frontier Communications and divested properties related to the Alltel acquisition. Looking ahead, Verizon expressed optimism for the second half of 2010. The company anticipates continued year-over-year revenue and retail postpaid Average Revenue Per User (ARPU) growth in its Wireless segment, alongside strong EBITDA margin performance. Furthermore, Verizon expects improved EBITDA margins in its Wireline business following cost reduction initiatives and workforce reductions, particularly for the properties remaining after the Frontier transaction. The company also reiterated its full-year 2010 capital expenditure guidance and confirmed plans to launch 4G LTE service in 25-30 markets by year-end.
Key Highlights
- 1Adjusted EPS for the first half of 2010 was $1.13, excluding $0.12 related to the Frontier spin-off and Alltel acquisition divestitures.
- 2Verizon expects adjusted EPS for the second half of 2010 to be 5-10% higher than the $1.01 adjusted base (excluding divested properties).
- 3Anticipates continued year-over-year Wireless revenue and retail postpaid ARPU growth in the second half of 2010.
- 4Expects strong EBITDA margin performance to continue in the Wireless segment during the second half of 2010.
- 5Forecasts improved Wireline EBITDA margins in H2 2010 compared to H1 2010, driven by cost reduction initiatives.
- 6Reiterates full-year 2010 capital expenditure guidance of $16.8 billion to $17.2 billion.
- 7Confirms plans to launch 4G LTE service in 25-30 markets by the end of 2010.