The company, which is the largest wireless provider in the United States and the second-largest wireline carrier, plans to lay off workers in its fixed-line unit, it said on Tuesday. In 2009, Verizon axed 13,000 positions, ending the year with 117,000 employees in that division and 223,000 overall.
Verizon blamed slower sales for the pending slashing and burning. But overall revenue actually rose 9.9 percent to $27.1 billion. Wall Street expected $27.3 billion, according to Bloomberg. The trouble lies in the landline division, where sales dropped 3.9 percent. High unemployment hit Verizon’s FiOS TV and Internet expansion efforts hard, an analyst told BusinessWeek – and now Verizon will only add to its own problem.
Ironically, part of the reason for Verizon’s net losses – which compared to a $1.24 billion profit in the year-ago period – came from charges for layoffs in 2009. The company paid $3 billion to get rid of thousands of workers. (And now, as more employees prepare to lose their bread and butter, keep an eye out for year-end bonuses for executives – it’s the American Way.)
Meanwhile, here are the quarter’s official stats: Verizon said it added more than 2.2 million mobile customers, with 1.2 million coming from retail and about 1 million coming from reseller partners. The numbers were about double what analysts had expected. CEO Ivan Seidenberg also told analysts on a conference call the Motorola Droid, launched in October, has sold well and that more smartphone additions are in the works.
Verizon’s share price had dipped more than 2 percent by about noon Eastern, trading at $30.03.