Strong wireless customer additions and cash flow highlight Verizon's 2Q and first-half 2020 results
Disciplined network strategy, strong operational performance, and wireless customer growth
2Q 2020 highlights
NEW YORK, July 24, 2020 (GLOBE NEWSWIRE) -- Verizon Communications Inc. (NYSE, Nasdaq: VZ) reported second-quarter results today highlighted by increased cash flow and strong momentum heading into the second half of the year.
"Through extraordinary circumstances, Verizon delivered a strong operational performance in the second quarter," said Chairman and CEO Hans Vestberg. "We remain focused on our strategic direction as a technology leader, quickly adapting to the new environment and providing our customers with reliable and vital connections and technology services, while working to keep our employees safe and accelerating our 5G network deployment. We have embraced, engaged in and responded to important social movements happening throughout the world, and will continue to be at the forefront of initiatives that move the world forward for everyone. We are proud of what we have done, and continue to do, for our customers, shareholders, employees, and society."
For second-quarter 2020, Verizon reported EPS of $1.13, compared with $0.95 in second-quarter 2019. On an adjusted basis (non-GAAP), second-quarter 2020 EPS, excluding special items, was $1.18, compared with adjusted EPS of $1.23 in second-quarter 2019. The company estimates that second-quarter 2020 EPS and adjusted EPS included approximately 14 cents of COVID-19-related net impacts, primarily driven by impacts to wireless service revenue and lower advertising and search revenue from Verizon Media. The company expects total wireless service revenue growth for third-quarter 2020 of -1 percent to flat year over year. The company also recognized an aggregate tax benefit of $156 million in connection with a series of legal entity restructurings related to an internal reorganization, which resulted in an approximately 4 cent benefit to second-quarter 2020 EPS and adjusted EPS.
Second-quarter 2020 EPS included a pre-tax loss from special items of about $255 million, which consisted of a net pre-tax loss of $102 million related to early debt redemption costs and a net charge of $153 million related to a mark-to-market adjustment for pension liabilities.
In second-quarter 2020, Verizon's results also included the continued effects of a reduction in benefits from the adoption of a revenue recognition standard, primarily due to the deferral of commission expense. The net impact was 2 cents in second-quarter 2020.
Outlook and guidance
The company continues to expect the following results for full-year 2020, and notes that this guidance assumes no significant deterioration to the macroeconomic environment or material changes to the company's bad debt reserves:
NOTE: See the accompanying schedules and www.verizon.com/about/investors for reconciliations to generally accepted accounting principles (GAAP) for non-GAAP financial measures cited in this document.
Verizon Communications Inc. (NYSE, Nasdaq: VZ) was formed on June 30, 2000 and is celebrating its 20th year as one of the world’s leading providers of technology, communications, information and entertainment products and services. Headquartered in New York City and with a presence around the world, Verizon generated revenues of $131.9 billion in 2019. The company offers data, video and voice services and solutions on its award winning networks and platforms, delivering on customers’ demand for mobility, reliable network connectivity, security and control.
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