Verizon Communications Unfolds Earnings For 4QFY15

The last quarter's financial statements highlight the potential of the top telecommunication company.

On Thursday morning, January 21, 2016, Verizon Communications Inc. reported its earnings for the 4th and last quarter of 2015. The top telecommunication outperformed in the last quarter and met the Street’s expectations.

The company, which is headquartered in New Jersey, declared $0.88 earnings per share –0.01% more than the speculated amount and reported a 25% increase in EPS as compared to last year’s (4Q14: around 70 cents). The company’s Chairman and CEO, Lowell McAdam was confident on the company’s performance and said that the company has generated balanced result amidst the strong competition. Furthermore, the CEO said that the company looks forward to perform better in the coming year as it has attained and built next generation network capabilities that position the pioneer in the digital-first mobile world in 2016.

The US based company also surprised the analysts when it managed a net addition of 1.5 million customers in the last quarter. Moreover, the organization’s rate of customer’s attrition, or defection, fell down to 0.96% -significantly better as compared to last year’s 1.14%.

For the year quarter, the company reported revenue of $34.3 billion –a 3.2% increase as compared to the last year’s same quarter. In comparison with last year’s same quarter loss of $2.2 billion, the carrier generated a profit of $5.4 billion in the last quarter.

The New Jersey giant has expanded its horizon and invested in lot of different ventures in order to generate more revenue for the company. The organization has made an investment of $28 billion in spectrum licenses and capital for future network capacity. Moreover, the company spent $4 billion in acquisition of AOL Inc. in an attempt to create a digital advertising business.  

The top performing telecommunication company views the acquisition of AOL Inc. and Millennial Media as a prudent step that will strengthen company’s capabilities of developing and introducing high-tech applications to its customers. For example, last year, the company has launched a mobile video app with a name of “go90.” Also, it looks forward to develop technology platform for new machine-related businesses.

Because of the new incentives which the company is looking into, the company believes that the coming year  will be a tough one. Verizon’s CEO, Fran Shammo expressed his views and told the analysts that just like any new business which initially withstood losses and then gradually begins making profit, Verizon too will have a hard time in executing its new plans and strategies. He commented that he believes go90 will take a few years to generate higher returns for the company. Reportedly, the video app has managed to gain 2 million downloads since its launch in October but no official statement was given by Verizon to verify its active monthly users.

Without a doubt, the company has gone under a transformational change in 2015 and it is highly probable that in 2016 Verizon will be set out to the road of success.

The Verizon stock price stood at $45.87 –an increase of almost 3.3% at the marked which closed on Thursday.   

   

Verizon Communications Earnings Per Share (EPS) Expectations

Verizon Communications is publishing its Q4 financial statements and analysts are keen to find out whether the company has met their expectations.

On Thursday, January 21, 2016, Verizon Communication is set to put forward the company’s fourth-quarter financial statements. Analysts have forwarded different speculations about the organization’s revenue and earnings per share.

According to Thomas Reuters, the top telecommunication company is expected to have $0.88 earnings per share – a 23% increase as compared to the same quarter last year (2014:$0.77). The analysts expect the business to earn revenue of $34.06 billion – around 3% more than the same quarter of last year’s (2014:$33.19 billion) while the full-year revenue of the business is expected to be $131.5 billion – a 3% increase as compared to last year’s (2014:$127.1 billion).

Analysts are also confident that the New York based company has potential to perform better in 2016. Verizon stock news gives the following picture: JPMorgan Chase & Co. has suggested an Outperform rating while lowering down the price target of its stock by almost 4% from $57 to $55. Cowen evaluated the stock at Market Perform. BTIG Research has rated the stock from “Buy” to “Neutral” while Citigroup has given “Hold” rating.

Although, the telecomm giant is expected to declare favorable financial position of the Verizon, the organization’s performance is susceptible to high competition. The Kansas based wireless accessories provide, Sprint Corp. had shaken the industry when it announced a half-price offer to its customers. The analysts are intrigued to find out whether Verizon maintained its strong subscriber growth. Analysts at Wells Fargo are confident that the company will be able to maintain their strong 1.5 million postpaid subscribers.

Eyes are all set on to see the plans of Verizon wireless business, which was earlier reported to have said that it would take part in the government’s auction of wireless airwaves. Further, FirstNet, a nationwide public safety network, requires a carrier partner. Investors are waiting to find out about company’s official view regarding the proposed plans.

People are also expecting to learn company’s stance regarding Yahoo’s anticipated sale. Initially, Verizon showed the interest in the deal but a concrete statement on the potential deal has not yet been made by the entity. Analysts are ambitious and will find out as soon as the Thursday market opens. 

The stock market on Wednesday displayed the Verizon stock at $44.45 – a 0.94% decrease. The analysts unanimously proposed a price target of $50.58 and a 52-week trading range of $38.06 to $50.86. Favorable conditions are anticipated ahead for the business this year. 

Apple App Store Generates Significantly More Revenue Than Google Play Store

Apple App Store boasts of stronger revenues in comparison to Google Play Store.

Alphabet’s Google Play Store had an amazing start where they observed 100% growth in contrast to Apple Inc.’s App Store as reported by VentureBeat. App Annie, which is an app analytics company, came up with their retrospective report for the fiscal year of 2015, where it was deduced that the company observed 60% growth in FY14.

Google recently launched the new smartphone series, Nexus 5X and 6P, which have resulted in growth for the app store. Moreover, it is also speculated that the Android operating system 6.9 Marshmallow might just be the catalyst for the change. The company has refined the operating system and is now simplified that might attract masses.  

However, one thing that was not part of the report was the revenues. Ironically, despite the growth of Google’s Play Store, the Apple iPhone maker has succeeded in getting 75% more revenue in comparison to Google.

Google App Store and Apple App Store now have a substantial gap. All those developers that are working for Apple tend to get more money in comparison to their counterparts. The brand has now become a status symbol among customers.

Undoubtedly, Google’s operating system is presently the most commonly used operating system in the fraternity. This has resulted in several inconsistencies due to the segmentation in the market but the Play Store has a massive consumer base. Other than that, all the users who buy an iPhone have the advantage to opt for in app purchases or paid apps.

Another factor that was highlighted in the report was that the majority of the growth in terms of the app store was observed from outside the United States. Countries that contributed significantly to the growth were Indonesia, Brazil, Turkey, India and Mexico. On the contrary, the Apple App Store observed its growth from countries like United States, Japan and China.

Apart from this, Android is likely to embrace growth this annum too. However, this growth will not act as a major revenue source and AAPL will remain the uncrowned king of the fraternity. The company is paying a lot more to the developers in contrast to Google since they are not making that much money overall.

Another factor taken into consideration is that the purchasing power of Apple buyers that is stronger than Google. Thus, revenues boost due to the purchasing power of the users who can spare out money for purchases on the App Store.