Verizon gets a big revenue boost from the iPhone

Faith Merino · July 22, 2011 · Short URL: https://vator.tv/n/1d0a

Verizon activated 3.6 million iPhones in Q2 2011

The iPhone brings joy and happiness to the lives of those it touches.  That’s definitely been my experience.  Except for that time I went to France and didn’t turn off my data, and was consequently hit with massive data roaming charges that made me cry.  But Apple and I have moved on from that nasty little incident and have since made up.  Today, Verizon is seeing some iPhone love as it posts higher than expected second quarter earnings.

The company reported revenues totaling $27.54 billion in Q2 2011, a 2.8% increase over the same quarter last year, when Verizon posted revenues of $26.77 billion.  Analysts had expected Verizon to bring in $27.4 billion. 

Data revenues, which make up 39.5% of all service revenues, were up to $5.8 billion, representing an increase of 22.2%.  Net income for the quarter was $1.6 billion, or 57 cents a share, compared to a loss in Q2 2010 of $1.19 billion. 

“In terms of earnings growth and the acceleration of revenue growth, this has been one of Verizon’s best quarters since the 2008 economic downturn,” said Chairman and CEO Ivan Seidenberg.  “We expect Verizon Wireless to gain share in the retail postpaid market and widen its network-quality lead throughout 2011. We also continue to see strong customer demand for FiOS Internet and TV, and for cloud and other strategic services.”

So did the iPhone have anything to do with the uptick in Verizon’s revenues?  The company activated 2.3 million iPhones in Q2, bringing its total number up to 4.5 million.  Those numbers boosted Verizon’s smartphone penetration to 36%, up from 32% in the previous quarter.

But AT&T still has a one up.  Earlier this week, AT&T reported its earnings and revealed that it activated 3.6 million iPhones in Q2—most likely due to the fact that AT&T has the advantage of selling the GMA-only iPhone 3GS, which is available for $49.

In addition to its Q2 earnings report, Verizon also announced Friday that Ivan Seidenberg is stepping down as CEO, as per the company’s CEO succession process, which has been underway since 2010.  While Seidenberg is remaining in his position as Chairman, the role of CEO is going to Verizon President and COO Lowell McAdam.  McAdam will be stepping up to the CEO plate August 1. 

 

Image source: Wordpress.com

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