Verizon Communications shares took a hit from second quarter earnings that managed to meet Wall Street expectations, but didn't deliver enough of an oomph to prevent the company's shares from tumbling 2.9 percent in after-hours trading.
The pain point in Verizon's second-quarter figures mostly came from the company's enterprise business – bullied around by foreign exchange rates and European financial woes, according to a published report.
Verizon's subscriber figures actually raised some eyebrows – in a good way – as the company reported that it added 880,000 new wireless subscribers in the second quarter alone.
That figure is more than 200,000 subscribers higher than the figures analysts were expecting Verizon to announce.
Analysts interviewed in the report don't expect Verizon's chief competitor, second-ranking AT&T, to add half as many subscribers as Verizon was able to sign on during its big quarter.
Charging Subs
While Verizon's new gains might be down from the 1.26 million subscribers it added during last year's second quarter, the company's mobile data revenues have grown 18.5 percent to $6.9 billion in the same time frame.
In other words, the mobile carriers are successfully shifting to – and profiting from – new tiered service plans, in addition to trying to one-up each other with fancier smartphones and speedier data networks (which all just feed right back into those tiered service plans).
And that includes a gradual transition away from grandfathered "unlimited data plans" of yesteryear's 3G service into the tiered data structures of Verizon's work-in-progress 4G LTE network.
"The benefit we do see is that we are seeing some 3G unlimited customers move into our 4G shared data plan product," said Verizon CFO Fran Shammo, as reported by The New York Times. "That is excellent for us."
Verizon's introduction of its "shared data plans," which tend to benefit its heavier users of voice, data, and texting versus lighter users, were introduced in late June – which meant that they didn't end up paying a major role in Verizon's second-quarter earnings, reports the Times' Brian X. Chen.
Upgrading Subs
According to Verizon Wireless, half of its total wireless subscriber base are now using smartphones, up three percent from first quarter figures.
It's reported that Verizon Wireless now counts 94.2 million customers among its ranks, up 4.9 percent from the same time period last year.
