Verizon Posts Record Revenue, But Income Declines On Pension Charges

Despite reporting record revenue growth, Verizon Communications saw a net income loss in the fourth quarter, due to pension charges.

The telco said its overall quarterly revenue was up 7.7 percent to $28.4 billion; its annual revenue was $110.9 billion, up 4 percent.

However, its fourth quarter consolidated statement, which included its wireless and wireline businesses, reflected a net income loss of $212 million due to a $3.4 billion after-tax charge related to a revaluation of its pension plans. That compares with a profit of $4.6 billion in the fourth quarter of 2010. For the 12 months ending Dec. 31, the telecom carrier reported income was down slightly from $10.217 billion in 2010 to $10.198 billion.

Total revenue for the wireless business was the bright side of the story. Verizon Wireless took in $18.3 billion in fourth-quarter 2011 revenue, a 13.0 percent increase year over year. Data revenue was $6.3 billion, up more than $1.0 billion or 19.2 percent year over year. Data revenue comprises 41.6 percent of all service revenue, which totaled $15.1 billion, up 6.4 percent year over year.

For full-year 2011, total wireless revenue came in at $70.2 billion, indicating growth of 10.6 percent from full-year 2010; service revenue was $59.2 billion in 2011, up 6.3 percent year over year.

Verizon added 1.5 million retail customers, its largest hike in three years, bringing the telecom provider up to 92.2 million retail customers. Seventy percent of Verizon’s postpaid phone sales were smartphones; it sold 7.7 million smartphones during the quarter. Verizon's smartphone share is now 44 percent. All those sales of Android-based devices and iPhones contributed to the growth in annual revenue per user (ARPU): Retail postpaid service ARPU grew 2.5 percent to $54.80, while retail postpaid data ARPU of $22.76, up 14.3 percent year over year.