Jul 26, 2016 12:56 PM
Verizon 2Q profit hurt by strike; revenue disappoints
The Associated Press
NEW YORK (AP) — Verizon Communications said Tuesday that a strike by 40,000 employees hurt its results in the second quarter, and the company's revenue fell short of analyst projections.
The largest U.S. cellphone carrier's profits were hurt by a series of costs. One was a seven-week strike by around 40,000 employees that began in April. It was one of the larger strikes by U.S. workers in recent years and Verizon said it cut into profits from its wireline business.
Verizon said its net income after paying dividends on preferred stock fell to $702 million, or 17 cents per share. Excluding one-time costs related to the strike, charges related to the early redemption of debt, and other items, Verizon said it earned 94 cents per share.
Its revenue fell 5 percent to $30.53 billion.
Analysts expected Verizon to report earnings of 93 cents per share on $31.12 billion in revenue, according to Zacks Investment Research.
The earnings report came a day after the New York company said it has agreed to buy Yahoo's internet business for $4.83 billion. It will combine Yahoo with AOL, which it bought last year for $4.4 billion.
On Tuesday, Verizon said the two businesses will give it a valuable group of online properties and mobile applications with more than 1 billion views per month.
Shares of Verizon declined 92 cents to $54.95 in midday trading. Its shares have risen 19 percent over the past year. Earlier this month Verizon stock hit its highest price since 2000.
Investors have snapped up telecommunications companies like Verizon and AT&T because of their attractive dividend payments.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on VZ at http://www.zacks.com/ap/VZ
Keywords: Verizon Communications, Earnings Report, Priority Earnings