Verizon Communications (NYSE:VZ) revealed on Thursday a 17% increase in first-quarter profit that edged ahead of Wall Street expectations, as subscriber additions helped boost service revenues.
The New York-based communications giant reported net income of $3.9 billion, or 59 cents a share, compared with a year-earlier $3.26 billion, or 51 cents. Analysts in a Thomson Reuters poll were expecting just 58 cents.
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Revenue for the three months ended March 31 was $28.2 billion, up 4.6% from $26.9 billion a year ago, narrowly beating the Street’s view of $28.17 billion.
Verizon, the first of the big operators to report first quarter results, said it sold 3.2 million phones in the first quarter, helping to bring the percentage of Verizon Wireless’ retail postpaid customer phone base with smartphones to 47% from 43.5% last year.
The wireless company, which is jointly owned by both Verizon and Vodafone (NYSE:VOD), added 734,000 retail net customers, helping to lift service revenues by 7.7%.
Verizon Communications added 193,000 net new FiOS Internet connections and about 180,000 net new FiOS video connections during the quarter. Service revenues in the wireline division rose 11.6% during the quarter.
The company’s chief executive, Lowell McAdam, said Verizon is confident it will improve Wireline margins for the full year.
“Verizon delivered double-digit earnings growth and strong cash flow this quarter,” McAdam said. “We built momentum coming out of 2011, and our results show that we continue to execute in the key growth areas of our business.”
On Wednesday, Verizon Wireless, the nation's biggest wireless carrier, said it would sell some of its 700 megahertz spectrum should the Federal Communications Commission approve of its proposed $3.6 billion acquisition of airwaves from a group of cable companies.
That purchase has been criticized by Verizon’s smaller rivals, particularly T-Mobile USA, which believes it would give Verizon an unfair share of the market.