HomeBlogFinanceLive news updates from October 21: Rishi Sunak reaches nomination threshold, Yen falls to 32-year low

Live news updates from October 21: Rishi Sunak reaches nomination threshold, Yen falls to 32-year low

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Verizon, the biggest telecommunications group in the US, said it expected additional disconnections by customers in the current quarter in response to recent price increases for its services.

Signs of consumers’ sensitivity to prices, a reflection of the high inflationary environment afflicting many Americans, added to the disappointment of the company reporting slow subscriber growth and a plunge in third-quarter profits, sending shares to an 11-year low Friday.

Verizon had just 8,000 net subscriber additions for its wireless phone services in the third quarter, as it struggled against rivals in an increasingly competitive market. The company lost 189,000 consumer accounts in the quarter, but managed to add 197,000 business subscribers.

The New York-based company raised prices for its metred-data and consumer wireless plans in June, following rival AT&T’s plan to raise the cost of its older wireless phone plans.

“The pricing actions we took around administrative fees and metered plans led to an increase in disconnects,” chief financial officer Matthew Ellis conceded to analysts during a Friday earnings call. “With certain price-ups being phased in throughout the third quarter, we would anticipate some disconnect pressure to carry over into Q4.”

However, the higher prices for wireless service helped boost consumer revenue 10.8 per cent from a year ago to $25.8bn in the third quarter. In its smaller business segment revenue increased 1.9 per cent to $7.8bn.

Total revenue increased 4 per cent from a year ago to $34.2bn, as wireless service revenue growth and higher equipment revenue offset declines for wired services and the impact of merger and acquisition activity in 2021. That slightly beat analyst expectations for revenue of $33.79bn in the third quarter.

Verizon’s net income tumbled 23 per cent from a year ago to about $5bn in the third quarter, missing analyst expectations for $5.3bn.

The company maintained its full-year guidance of revenue growth in the range of 8.5 to 9.5 per cent and adjusted earnings per share of $5.10 to $5.25.

Verizon shares ended 4.5 per cent lower in New York on Friday, their lowest closing level since November 2011.

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