Verizon reported better-than-expected fourth quarter earnings as it added 1.2 million retail postpaid customers as it preps for a broad 5G network rollout. Revenue, however, fell short of expectations.
The company reported fourth quarter earnings of 47 cents a share on revenue of $34.3 billion, up 1 percent from a year ago. Non-GAAP earnings, which exclude fourth quarter charges of a goodwill writedown of Verizon Media of $4.6 billion, pensions and acquisition and integration charges, were $1.12 a share.
Wall Street was looking for non-GAAP earnings of $1.09 a share on revenue of $34.44 billion.
Verizon has been focused on a revamp that revolves around more focus and 5G. The company had previous acquired AOL and Yahoo to bulk up its advertising revenue and expand into media. Verizon restructured Verizon Media and offered buyout packages elsewhere in the company.
CEO Hans Vestberg said Verizon is "laser focused on delivering customers a best-in-class and game-changing experience on our networks."
Not surprisingly, Verizon's earnings conference call had a heavy dose of 5G talk. Vestberg noted that the company wants to be ahead of the pack and ultimately push the business and Internet of things use cases.
We advanced 5G development and delivered to the world the first true 5G deployment in 2018 with our initial 4 commercial markets, and this is real 5G. This is a completely transformative experience that gives customers speeds, measuring hundred of megabits to gigabits, reduce latency, the loss for connection per square kilometers by millions and ended at a fraction of today's consumption. 5G will pay dividends as we advance and lead the industry into the fourth Industrial Revolution.
For 2018, Verizon reported earnings of $3.76 a share, or $4.71 on a non-GAAP basis, on revenue $130.9 billion. Verizon said 2019 earnings on an adjusted basis will be similar to 2018 with revenue growth in the low single digits.
The company added 1.2 million retail postpaid net additions with smartphone adds of 873,000 in the fourth quarter. Verizon added 556,000 other connected devices such as wearables.
For the year, Verizon added 2.5 million net customers.
Wireless revenue was $24.4 billion in the fourth quarter, up 2.7 percent from a year ago.
Retail postpaid phone churn was 0.82 percent in the fourth quarter.
Verizon added 54,000 FiOS Internet connections in the fourth quarter, but lost a net 46,000 video customers due to cord cutting. Verizon said it had 6.1 million FiOS Internet subscribers at the end of the year.
Verizon generated cash flow of $34.3 billion, up $10 billion from a year ago.
Verizon Media revenue for the fourth quarter was $2.1 billion, down 5.8 percent from a year ago.
Verizon Connect, which includes IoT and telematics, delivered revenue of $242 million in the fourth quarter.