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Verizon profit beats estimates on remote working boost

FILE PHOTO: The Verizon store in Superior, Colorado, U.S., July 27, 2017. REUTERS/Rick Wilking

(Reuters) - Verizon Communications Inc beat estimates for third-quarter profit on Wednesday, helped by strong demand for its phone and internet services as offices and schools continued to operate virtually amid the COVID-19 pandemic.

The health crisis has brought global economies to a halt, but the telecom sector has been relatively less affected. With lockdowns easing, Verizon gradually reopened all of its company-operated retail stores in the quarter, implementing touch-less retail, appointments and curbside pickups.

Verizon added 283,000 postpaid phone subscribers in the third quarter, above the average estimate of 268,000, according to research firm FactSet.

Total operating revenue fell 4.1% to $31.54 billion, which the company attributed to lower customer activity and the timing of certain device launches.

Apple Inc, one of Verizon’s key partners, has delayed the launch of its new iPhones by about a month this year.

Revenue in Verizon’s media unit, which includes Yahoo, HuffPost and TechCrunch, declined 7.4% in the quarter to $1.7 billion from a year earlier as companies cut down on advertising to rein in expenses.

Net income fell to $4.50 billion, or $1.05 per share in the quarter, from $5.34 billion, or $1.25 per share a year earlier, with about 5 cents of COVID-19-related net impact, Verizon said.

Excluding items, Verizon earned $1.25 per share, above analysts’ average estimate of $1.22.

The company also said it now expects full-year 2020 adjusted EPS growth of 0% to 2%. Its prior guidance range was -2% to 2%.

Reporting by Noor Zainab Hussain in Bengaluru; Editing by Bernard Orr and Saumyadeb Chakrabarty

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