Verizon Gets a Dab of Weakness
These cases, located in the Midwest, were "relatively insignificant" and won't affect Verizon's earnings, she said. Verizon has been insisting all year that its business is healthy despite the weakening U.S. economy. (See Verizon Doesn't Fear Economy's Slump.)
AT&T Inc. (NYSE: T) CEO Randall Stephenson made similar comments in January when he remarked that his company had disconnected an unusually high number of wireline customers for the same reason. (See Whoa Mama Bell!)
Perhaps of more concern were Toben's remarks that Verizon sought more prepaid customers in the fourth quarter. Verizon has always been quick to point out that the vast majority of its wireless customers are postpaid subscribers. They're riskier than prepaid customers but typically pay higher bills and are locked into long-term contracts.
The fact that Verizon has been looking to add more prepaid subscribers could be a sign it is trying to hedge itself against further weakness in its postpaid customer base. The prepaid model is popular in more economically weak markets such as India.
Concerns of weakness aside, Toben said she expects double-digit annual revenue growth for the wireless unit during the next few years.
Separately, she tried to quell concerns that Verizon's new $100 unlimited calling plan would kick off a price war, saying she expects the plan to boost results and that the number of customers upgrading from a $79.99 plan would offset those who downgraded from plans worth more than $100.
Shares of Verizon are down 53 cents (1.5 percent) at $34.55 in midday trading.
— Raymond McConville, Reporter, Light Reading