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#VERIZON YAHOO WRITEDOWN FULL#
Verizon lost 46,000 Fios video connections due to cord-cutting.Ģ018 was a remarkable year full of 5G firsts, including being first in the world to commercially deploy 5G with our 5G Home product. The company has saved $2.3 billion so far through 2018.įios revenue grew 2.5% when excluding the impact of new revenue recognition standards, thanks in part to adding 54,000 net Fios internet connections. Verizon says it is on track to generate $10 billion in cumulative cash savings by 2021, a goal set in 2017, in order to fund dividend payouts. Verizon Media announced earlier this month that it was laying off 7% of its employees, impacting about 800 workers.Ĭapital expenditures were $2.3 billion in the fourth quarter, bringing full-year capital spending to $16.7 billion. The company recognized a $4.6 billion goodwill impairment charge related to Verizon Media. Verizon Media revenue fell 6% to $2.1 billion, but was up sequentially due to seasonality. On a GAAP basis, Verizon posted net income of just $2 billion, or $0.47 per share, due to the writedown. The company also added 11,000 tablet connections and 556,000 other connected devices, mostly wearables. Verizon reported 1.2 million retail postpaid net additions in the fourth quarter, including 873,000 postpaid smartphone net additions. “Even if Verizon’s move into media was wildly successful, it was hard to see how it could move the needle at a company dominated by wireless,” Piecyk said.What happened with Verizon Communications this quarter? While the idea of building a new media venture from a pile of online scraps might have held some allure, it was never going to transform the telecom giant, said Walt Piecyk, an analyst with BTIG LLC. The division was renamed Verizon Media Group/Oath under a new structure. The company signaled last month that it was shifting away from using the Oath brand, which has been heckled on social media.
That compares with a 22% decline for AT&T, its chief rival in wireless service. The shares rose 1.6% to $59.20 on Tuesday, bringing them to a nearly 12% gain for the year. Verizon investors seem relieved to put the writedown behind them. That will result in a charge of as much as $2.1 billion, which will be offset by a $2.1 billion tax benefit in the fourth quarter, the company said Tuesday. Verizon announced this week that 10,400 employees, or about 6.8% of its staff, had accepted voluntary buyouts as part of a belt-tightening campaign. But Armstrong stepped down from his position as CEO of Oath in October, shortly after Hans Vestberg became chief executive officer of Verizon. Oath was the vision of former Verizon executive Tim Armstrong, who had pursued a turnaround at AOL before the telecommunications giant acquired the business. The unit still has about $5 billion of assets remaining. The revision of the Oath division’s accounting leaves its goodwill balance – a measure of the intangible value of an acquisition – at about $200 million, Verizon said in a filing Tuesday. Though the bet hasn’t paid off, it at least stumbled on a smaller scale. Rather than attempt a megadeal like AT&T Inc.’s $85 billion acquisition of Time Warner Inc., Verizon only spent about $9.5 billion in the past three years buying fading web giants. The episode offered a silver lining for investors.
She likened the writedown to “ripping off the Oath band-aid.” “The hype of Oath has been over for some time,” Wells Fargo analyst Jennifer Fritzsche said in a note Tuesday. The move will erase almost half the value of the division it had been calling Oath, which houses AOL, Yahoo and other businesses like the Huffington Post. The wireless carrier slashed the value of its AOL and Yahoo acquisitions by $4.6 billion, an acknowledgment that tough competition for digital advertising is leading to shortfalls in revenue and profit.
is conceding defeat on its crusade to turn a patchwork of dot-com-era businesses into a thriving online operation.
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