NEW YORK – Verizon Communications Inc.’s profit edged higher in the third quarter as record growth in wireless and broadband subscribers offset declines in traditional phone lines.
Verizon said Thursday it earned $1.87 billion, or 67 cents a share, in the July-September period, up from $1.8 billion, or 64 cents a share, for the same period of 2004.
The results included a net gain of $37 million from the sale of a New York City office building, as well as tax benefits of $115 million that included a repatriation of foreign earnings. Those gains were offset by a $125 million expense relating to Verizon’s investment in aircraft leases affected by recent airline bankruptcies.
Verizon’s revenue totaled $19.04 billion, up 4.6 percent from the year-ago tally of $18.21 billion.
The third-quarter profit was on target with most Wall Street forecasts, while revenues came in a bit higher than expected by the analysts surveyed by Thomson Financial.
Verizon’s share price, which earlier this month sank to a multiyear low, rose 17 cents to close at $30.76 Thursday on the New York Stock Exchange. The stock is down nearly 24 percent after opening the year at $40.51.
“We feel bad that the stock has drifted down recently to two- and three-year lows,” Verizon chief executive Ivan Seidenberg said in a conference call with analysts. “We’re committed to getting the stock back to levels we think are commensurate with the underlying assets.”
Seidenberg expressed confidence that federal and state regulators would clear its acquisition of MCI Inc. with no major antitrust conditions, and said it would be completed by early January.
Later Thursday, the Justice Department issued its approval for the acquisition, as well as SBC Communications Inc.’s purchase of AT&T Corp., ordering the companies to sell certain assets to preserve competition in some markets. The agency said that without those conditions, the two deals would have resulted in higher prices for certain customers in eight Verizon markets and 11 SBC markets.
The deals are subject to approval by the Federal Communications Commission, which is expected to sign off at its monthly public meeting today.
Verizon Wireless, owned in a partnership with Vodafone Group PLC, accounted for $8.4 billion of Verizon’s revenue total, up 14.2 percent from the third quarter of 2004. The cellular customer base grew by 1.9 million subscribers, ending the quarter at 49.3 million.
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