Telecommunications giant Verizon has just released its Q3 2012 earnings, and posted double digital growth for the third consecutive quarter. Wireless service revenues accounted for a good chunk of income on the backs of record high profit margin. Verizon reported $29 billion in total operating revenue (up 3.9% over last year), as well as diluted earnings of $.56 per share, up from $.49 per share, a 14.3% increase over the third quarter last year.
Just like last time, Verizon owes much of its performance to its wireless business. Verizon Wireless gained an additional 1.5M postpaid users this past quarter, up from the 888,000 new contract-bound subscribers the carrier picked up during Q2. This increase drives Verizon’s total postpaid accounts to 34.8M, a 1% increase from last year.
Smart phones now account for 53% of Verizon’s postpaid wireless subscribers, and I’m curious to see how one particular device aided Verizon’s performance. Naturally, at least part of that surge can be attributed to Apple’s recently-launched iPhone 5 — earlier versions of the Cupertino company’s tiny mobile juggernaut accounted for nearly half of Verizon’s postpaid activations earlier this year after all, and Verizon is expected to shine a bit more light on the smartphone breakdown when the earnings conference call kicks off at 8:30 AM Eastern.
What more than a few wireless buffs spent time pondering in the days leading up to this release was what effect Verizon Wireless’s Share Everything plans would have on the company’s average revenue per user. After all, those shared plans (which are compulsory for new customers) can be more expensive for some individual users, while families and small businesses can end up spending less on service than before. Thanks to the new plans, the retail ARPA grew 6.5% over last year’s levels to $145.42 per month. Verizon is now reporting on an per-account basis (ARPA) rather than a per-user basis (ARPU)
Today’s release also further detailed the carrier’s 4G LTE rollout, stating that Verizon’s next-gen network is now available to more than 250M people in 419 markets across the US.
Meanwhile, things looked less than impressive when it came to Verizon’s wireline service. It yielded total operating revenues of $9.9 billion (a decline of 2.3% over last year), though on the upside, ARPU increased to $103.86 (up 10.3% compared to last year).