Verizon, the second largest phone company in the United States, beats analysts' expectations as it grew 4.6 percent thanks to an increase in mobile subscribers.
Its cellular branch, Verizon Wireless, jointly owned by Vodafone, remains the country's largest cellular network after adding just over half a million contract customers in the first-quarter, despite the mobile market close to reaching saturation point.
Verizon also attracted 734,000 retail customers in the first quarter. The company now has 93 million customers, a 5.2 percent increase from a year earlier, with only 5 million on a pre-paid service.
Earnings rose to $1.69 billion at 59 cents a share, up from $1.44 billion, or 51 cents a share a year earlier. The cellular company's revenue rose 17 percent to $28.24 billion from $26.99 billion.
And the controversial $30 upgrade fee hasn't even kicked in yet.
It comes as relief as the company reported a loss during its last fourth-quarter due to pension changes, despite riding on a strong revenue rise of 7.7 percent from a year ago.
Holiday sales of the iPhone 4S, announced and released in October last year, helped boost Verizon's revenue. While the cell service gained from sales of the iPhone 4 when it was released over a year ago, Apple's latest smartphone boosted sales significantly.
But the new device hurt profit margins at first as cell companies offer the device at a greatly reduced price, locking users into long-term contracts for a stable revenue stream. The average customer spent around $54 per month, a rise of 3.4 percent from the last quarter, likely due to data-hungry consumers.
The company also reported that 2.9 million devices sold by the company are capable of connecting to Verizon's 4G LTE network, making just over 9 percent of its entire customer base running on the next-generation mobile broadband network, representing a 22 percent increase over last quarter.
Verizon sold 6.3 million smartphones, which now represents 47 percent of the total base, and over two-thirds of the mobile devices sold during the quarter. It added that 'Internet devices' make up 8 percent of its post-paid customer base, with 62 percent of tablet customers opting for a post-paid contract.
Total revenue dropped for Verizon's wireline services by 2 percent to $9.9 billion, but the company says it sees "continued strong demand" for FiOS. Verizon has tried to offset the losses of its telephone customers to its fiber-optic services. The company netted 193,000 new fiber-optic FiOS Internet connections, and 180,000 new FiOS video connections.
Image credit: Jessica Dolcourt/CNET.
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