Verizon Falls Short; Nokia Slightly Beats Tepid Q2 Projections

Jacob Harper |

Verizon Communications Inc. (VZ) wasn’t immune to the worldwide move away from landlines. The telecom company claimed in their second quarter 2013 earnings report released that while their wireless business is strong, the traditional wireline business continued to sag. Jefferies analyst Thomas Seitz described the reports “mixed.”

Analyst consensus was right on concerning Verizon’s earnings-per-share estimate, but overestimated revenues. Verizon added numbers with the acquisition of Vodafone, which added 941,000 post-paid subscribers to their network. But the company faces stiffening competition from the other telecom giants, notably reports in early July of AT&T’s (T) possible major move into pre-paid wireless with the pending $1.2 billion purchase of Leap.
Verizon reported net income of $6.6 billion, or $0.73 per share, versus the $5.7 billion, or $0.66 per share, from the same period a year ago. Revenue for the quarter was $29.8 billion, as compared to $28.55 billion from the previous year. Analysts were expecting a profit of $0.73 per share on revenues of $29.83 billion.

Nokia Corporation (NOK) released their second quarter 2013 earnings report, and their numbers beat projections set by analysts, though those projections were not stellar to begin with. Sales for the beleaguered cell phone company fell 24 percent from the same period last year.

The Finnish company has struggled to find a footing in the emerging smartphone market, and has fallen to the wayside as Apple and Samsung continue to dominate. In June Chinese cell phone maker Huawei considered buying out Nokia, as did private equity firm Blackstone, though those talks have so far not come to fruition.

Among dropping sales in most markets, Nokia cited especially poor sales in China as a major factor in their earnings shortfall. Sales in China fell by 57 percent from the year prior.

There were two bright spots in the report. One, the company has stopped the hemorrhaging that threatened the company last year and dramatically cut their losses. And two, sales of their Lumia phones went up to 7.4 million, up from the 5.6 million in the first quarter of 2013.

Nokia reported net loss of $151 million, or a flat $0.00 per share, versus the $1.1 billion, or a loss of $0.09 per share, from the same period a year ago. Revenue for the quarter was $7.4 billion, as compared to $7.5 billion from the previous year. Analysts were expecting a loss of $0.03 per share on revenues of $8.63 billion.

Nokia’s stock is down .47 percent to $4.02 a share amid heavy trading.

 

 

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Companies

Symbol Name Price Change % Volume
FDBAY Federal Bk Ltd S/Gdr 144A n/a n/a n/a 0
NOK Nokia Corporation Sponsored American Depositary Sh 5.62 -0.04 -0.71 5,831,876
VZ Verizon Communications Inc. 52.15 -0.41 -0.78 10,545,000

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