Verizon is becoming more cautious on annual targets due to competition

NEW YORK (dpa-AFX) – The US telecommunications group Verizon is becoming more cautious in the face of tough competition for the current year. The management is only aiming for the lower end of the range in terms of sales with mobile communications services, which are of interest to the industry, and in terms of adjusted earnings before interest, taxes, depreciation and amortization (Ebitda). The company, which competes with Deutsche Telekom subsidiary (Deutsche Telekom) T-Mobile US, announced this on Friday in New York.

Accordingly, annual revenue from mobile communications services is only likely to increase by around nine percent from the previous year’s value of 68.5 billion US dollars (63.1 billion euros). According to the new forecast, the operating result should increase by two percent. The stock lost two percent in premarket trading.

In the first three months, group sales increased compared to the same quarter last year by two percent to 33.6 billion dollars. Analysts had expected that. Verizon benefited above all from higher revenues from mobile communications services, which increased by almost a tenth and account for more than half of total sales. However, the company effectively lost 292,000 mobile contract customers, while its competitor AT&T had already reported a significant plus of 691,000 new contracts after deducting terminations the day before.

Operating profit remained stable at just under $7.8 billion. The bottom line is that profits fell by around an eighth to $4.7 billion, even though the group had to pay less taxes and interest. The decrease is due to the item other expenses and income. A year ago, the group had posted income of $400 million here, while expenses of just over $900 million were incurred at the beginning of the year. Verizon posts expenses for pension obligations or early loan repayments here, among other things./ngu/zb/jha/