Verizon net income up, beats analyst expectations

Total revenues up approximately 7 percent

Verizon Communications on Wednesday reported net income of $1.76 billion in the first quarter of 2005, up from $1.2 billion in the first quarter of 2004.

The large telecommunications carrier posted earnings per share of $0.63 in the first quarter of 2005, beating analyst expectations of $0.60 per share, according to Thomson First Call.

Total revenues were up nearly 7 percent from the first quarter 2004 to 2005, driven by 20 percent revenue growth at Verizon Wireless, the company said.

Verizon reported consolidated revenue of $18.2 billion, up $1.1 billion compared to the same quarter a year ago. Consolidated revenue includes $7.4 billion from Verizon Wireless and $9.5 billion from Verizon's Domestic Telecom division. Domestic Telecom revenue dropped from $9.6 billion in the same period a year ago, while Verizon Wireless has posted year-over-year revenue growth of 20 percent or more during the past five quarters, according to the company.

Verizon reported a net increase of 1.6 million new wireless customers during the quarter ended March 31, reflecting the largest quarterly customer growth in the history of Verizon Wireless. Verizon also reported 385,000 new wireline broadband connections during the first quarter, for a total of 3.9 million broadband connections. Verizon's wireline broadband services include DSL (digital subscriber line) and its FiOS fiber-optic-based service.

Verizon has transformed itself from a telephone company to a broad-based communications company, noted Jeff Kagan, an independent telecom analyst.

"Verizon is a great example of the change that is reshaping the industry," Kagan said in an e-mail. "While their traditional phone business is no longer growing like it was, their wireless business is growing strongly, and so is their broadband business. Verizon is a great growth story of a company and an industry in transition. You can look at Verizon and see the changes that are reshaping the industry."