Verizon unsurprisingly reported strong wireless postpaid net additions for the fourth quarter (having pre-released wireless subscriber metrics earlier this month), though revenue across its wireline segments declined.
Total wireless revenues were up 2.7 percent year over year to $24.4 billion, though service revenue climbed only 0.1 percent.
For the quarter Verizon added 1.2 million postpaid net additions, including 653,000 phone net adds, 11,000 tablets, and 556,000 other connected devices, which were mainly wearables. Postpaid phone churn for the quarter was 0.82 percent.
Verizon has been vocal about being a leader in 5G, launching its fixed wireless 5G home broadband service in October, but during the company’s earnings call Tuesday, executives did not disclose any more details about exact timing of the mobile 5G.
CEO Hans Vestberg noted that the company has been working for several years to not only understand engineering 5G technology and spectrum, but also operations, marketing, installations and the like, according to a transcript of the call from SeekingAlpha. He indicated that Verizon is waiting for the rest of the ecosystem to catch up.
“We’re not holding back coming out to 5G; it’s more that we just need to see that the ecosystem is equally ready as Verizon is right now,” Vestberg said.
However, it’s still unclear what specific 5G services or applications will prove to be the money-makers for carriers investing in build-outs.
“Notwithstanding an enormous amount of hype about all the good things 5G might deliver, there still isn’t much of a revenue story attached to it, especially for mobility,” MoffettNathanson’s Craig Moffett wrote in a Tuesday research note.
On the wireline side, Verizon added 54,000 Fios internet subscribers, while losing 46,000 video subscribers. Video losses for the quarter were worse than the 29,000 Verizon lost a year ago, as consumers continue to seek out less expensive alternatives to pay-TV. Consumer revenues were down 0.6 percent from the year ago period to $3.16 billion. Enterprise was down 3 percent, partner solutions declined 9.2 percent, and Business Markets revenue decreased 5.5 percent year over year. Overall total wireline operating revenues were down 3.2 percent to $7.37 billion.
Verizon has been strongly focused on its technology and network buildout and shifted away from content and advertising, which were housed in its former Oath business. Verizon Media revenues were down 5.8 percent to $2.1 billion.
Total consolidated revenues for the fourth-quarter were $34.3 billion, up 1 percent year over year.
Verizon said it’s also on track to hit its $10 billion cost-savings goal by 2021.
The company forecast capital spending for 2019 to be between $17 and $18 billion, compared to the $16.7 billion in CapEx during 2018.
Moffett acknowledged that 2018 was undoubtedly a good year for Verizon, but questioned whether it gets better from here.
“Guidance for 2019–low single digit revenue growth and flat EPS–isn’t inspiring, particularly given a macro backdrop that is widely expected to slow,” Moffett wrote.