Verizon revealed that it lost over 307,000 wireless customers who are billed every month, the most profitable kind of wireless subscriber.
It's only thanks to Verizon's launch of unlimited plans that the bloodshed isn't worse. The performance marks a dramatic reversal from the first quarter of previous year, when Verizon added 640,000 users.
Total revenue, which includes the wireline segment and Fios service, fell 7.3% to $29.8 billion.
This New York-based carrier was once the superlative leader of the wireless industry in the U.S., whereas now it is battling to retain subscribers and getting them to opt for the paid premium service.
What happened with Verizon this quarter? Turns out, it took bringing back truly unlimited data from the dead to step a gush of subscribers from the network. The question now is, "What is the reason behind this loss of customers and the unlimited data plan?"
This earnings release is the first glimpse at how Verizon has fared since launching an unlimited data plan in February.
Verizon's retail postpaid connections base grew 1.2 percent year over year to 108.5 million, and retail prepaid connections grew 0.5 percent to 5.4 million.
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Our first-quarter results again demonstrated that customers value a high-quality network experience. "The launch of Verizon Unlimited positively changed the trajectory of customer additions in the quarter", the company said.
Verizon expects full-year 2017 consolidated revenues to be fairly consistent with 2016, with improvement in wireless service revenue and equipment revenue trends; also, full-year 2017 consolidated adjusted EPS trends to be similar to consolidated revenue trends.
Industry analysts have questioned whether the company will pursue a more transformative deal as its main competitor AT&T seeks to diversify its business through a planned acquisition of Time Warner.
The company has also explored bigger transactions, including with Charter Communications Inc., The Wall Street Journal has reported, though executives have recently signaled the two sides are far apart. Verizon's shares were down 1.2 percent at $48.33 in midday trade. They led us to believe that the EPS would be 96 cents per share on revenue of $30.5 billion.
In first-quarter 2017, Verizon added a net of 35,000 Fios Internet connections and lost a net of 13,000 Fios Video connections.
"We're confident in executing our strategy organically, but if there's the right opportunity out there to accelerate the strategy inorganically in a way that adds holder value, we're always looking at those opportunities", said Verizon Chief Financial Officer Matt Ellis on a call with analysts. Verizon's 2017 effective tax rate should fall within a range of 34 to 36 percent, the company said, which would exclude any impacts from the Trump administration's potential tax reform.