Published: Fri, April 21, 2017
Business | By Sandy Mccarthy

Amid competition, Verizon loses key customers for first time

Amid competition, Verizon loses key customers for first time

What makes this news even crazier is the fact that they had to openly admit that it was on track to be even worse had they not introduced Verizon Unlimited, their new unlimited plan.

Capital expenditures totaled $3.1 billion in first-quarter 2017, as Verizon maintained its network leadership. Growth in the wireless subscribers has slowed down now that most Americans have a cellphone. On a per-share basis, Visa earned 18 cents a share versus 71 cents a share a year ago. This in turn affected its financials - the company experienced a decline of 5.1% in its wireless business revenue.

In a call with analysts, Matt Ellis, the Chief Financial Officer of the company said - "We're confident in executing our strategy organically, but if there's the right opportunity out there to accelerate the strategy inorganically in a way that adds shareholder value, we're always looking at those opportunities". Considering that analysts expected Verizon to add almost 250,000 customers in the first quarter, that's dire. That's insane. I can't even tell you the last time Verizon lost phone customers. "Verizon just wasn't competitive without unlimited, and now they are". Prior to the launch in mid-February, Verizon had a retail postpaid phone net loss of 398,000; after the launch, Verizon added 109,000 retail postpaid phone connections.

Visa processed $1.73 trillion on its credit and debit card network in the quarter, up 37 percent from a year earlier, but that increase includes the processing business of Visa Europe as well.

Verizon Communications Inc VZ.N , the No. 1 USA wireless carrier, reported a 20 percent fall in quarterly profit as it lost wireless postpaid subscribers despite the re-launch of unlimited data plans.

Roughly 72% of postpaid phone customers are on non-subsidized plans as consumers continue shifting toward installment or leasing plans. Based on total revenue, operating margins were 33.9%.

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Everyone wants to know what Verizon has planned in response.

Shares of the No. 1 U.S. wireless carrier fell 1.7 percent to $48.10 in premarket trading.

". we extended our wireless and fiber network capabilities, began offering an unlimited pricing option and expanded our opportunities in new markets", Verizon Chief Executive Lowell McAdam said in a statement, commenting on the latest quarter.

In first-quarter 2017, Verizon added a net of 35,000 Fios Internet connections and lost a net of 13,000 Fios Video connections.

Verizon expects improvement in wireless service revenue this year, with total revenue "fairly consistent" with 2016.

It doesn't help that Verizon said in Thursday's earnings report that AOL's revenues fell 4% in the first quarter. "The coming quarters will probably look a lot different than the past quarters".

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