Verizon Communications Inc. saw the biggest jump ever in new broadband wireline subscribers, and that in part helped buoy the company’s third-quarter earnings.
Verizon added a company record 389,000 wireline broadband connections, now combined to include DSL and “FiOS” fiber-to-the-home connections. That brings its total broadband connections to 4.5 million, a number that has grown 42.3 percent since the third quarter of 2004.
Revenues from broadband and other wireline services increased 4.6 percent in average revenue per user to $51.61 monthly. Strong demand for wireline broadband services played a major role in that growth, contributing $2.2 billion in revenue for the quarter. That’s a 10.9 percent jump compared to the $1.9 billion collected for broadband wireline data services year over year.
The quarterly numbers indicate the FiOS service is making significant gains. Verizon is now either deploying or selling FiOS-branded data service in 15 states, passing 2.5 million homes as of the end of the quarter with plans to extend that to 3 million homes by the end of the year. In the 35 markets where it is has been selling FiOS service for more than six months, the average market penetration is about 12.4 percent – a significantly faster ramp-up compared to early DSL deployments.
Verizon now plans to extend FiOS to an added 3 million homes in 2006, bringing the total number of homes passed with the platform to 6 million.
Overall, Verizon posted quarterly earnings totaling $1.9 billion, or 67 cents per diluted share. Operating revenues came in at $19 billion for the quarter, a 5.4 percent increase from the $18.1 billion posted in the same quarter in 2004. If that growth continues, the company expects full-year revenues to be 5.5 percent to 5.8 percent higher compared to 2004.
“Our revenues continue to grow as we have changed our revenue mix, stabilizing traditional wireline revenues while continuing great wireless growth,” said Ivan Seidenberg, Verizon chairman and chief executive officer.
Capital expenditures have so far totaled $6.2 billion for the first nine months of 2005, driven in part by the startup of FiOS data service deployments. Wireline capex is expected to total $8.3 billion for the year.
The picture isn’t as rosy for voice service, which remained flat with $3.8 billion in revenue for the quarter.