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Verizon Sees Lower Profits in Q4

Wireless was once again a bright spot for Verizon Communications Inc. (NYSE: VZ), which this morning reported increased sales thanks, in part, to greater consumer demand for high-speed data services.

Verizon says that its fourth-quarter 2006 quarterly earnings fell to $1.0 billion, or 35 cents per share, from $1.7 billion, or 59 cents per share, in the year-ago quarter, due in part to charges related to the sale of its Dominican Republic business.

The company noted that its revenues were up thanks to growth in its wireless joint venture with Vodafone Group plc (NYSE: VOD) and new high-speed Internet subscribers. Revenues rose 26.1 percent to $22.6 billion compared to the same quarter in 2005.

No. 2 U.S. operator, Verizon Wireless added 2.3 million net customers in the fourth quarter, bringing its total subscribers to 59 million. The top-ranked U.S. carrier, Cingular Wireless , added 2.4 million users in the same quarter. (See Cingular Earnings Nearly Quadruple.)

Verizon's double-digit subscriber growth once again indicates that the top two carriers are growing faster than the third-ranked operator, Sprint Corp. (NYSE: S), which added 742,000 net subscribers but saw post-paid users fall by 306,000. (See Sprint Wobbles Again.)

The smallest of the four national carriers, T-Mobile US Inc. , reported this morning that its subscriber base has now reached 25 million, a 15 percent increase in customers during 2006. The U.S arm of T-Mobile International AG said that it added 901,000 net subscribers for the quarter, compared to 1.4 million net users in the same quarter in 2005. The operator reported 211,000 new smartphone subscribers in its December quarter, thanks to devices such as the BlackBerry Pearl.

— Dan Jones, Site Editor, Unstrung

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