Verizon Q2 Earnings Negatively Impacted By Union Strike, But Above Expectations

Verizon Communications Inc. reported second-quarter earnings above Wall Street expectations a day after reaching a deal to acquire Yahoo Inc.'s core internet business. Verizon reported net income for the quarter was $831 million, or 17 cents per share, compared with $4.35 billion, or $1.04 per share during the same quarter a year ago. Verizon said earnings were negatively impacted by 7 cents due to the seven-week strike by employees in its wireline business. Excluding non-operational items, earnings were 94 cents per share, just above the FactSet consensus of 92 cents. Revenue for the quarter hit $30.53 billion, a 5.3% decline compared with $32.22 billion in the year earlier period. The FactSet consensus on revenue was $30.84 billion. The cable, internet and phone company said the strike also resulted in a net decline of 13,000 Fios internet connections and 41,000 video connections. The company also mentioned its $4.83 billion deal on Monday to buy Yahoo's core business, which is expected to close in the first quarter 2017. "By acquiring Yahoo, we are scaling up to be a major competitor in mobile media," Chief Executive Lowell McAdam said in a statement. Verizon shares were inactive in premarket trade, but are up nearly 21% in the year to date, outperforming the S&P 500 Index , which is up more than 6%.