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Verizon, Sprint report 4Q
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February 1, 2001: 9:19 a.m. ET
Verizon 4Q in line with expectations; Sprint tops forecasts by 2 cents
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NEW YORK (CNNfn) - In the shadow of steep competition and a declining long distance phone market, two major telecommunications companies reported fourth-quarter results Thursday, with Verizon Communications Inc. matching analysts' forecasts and Sprint Corp.'s long-distance phone service operations surpassing expectations.
Both companies were hurt by declining or flat long distance revenue, but saw stronger growth in newer high-speed digital and wireless services.
Verizon, the No. 1 local phone service carrier, reported fourth-quarter earnings of 77 cents a share, in line with Wall Street expectations on the strength of its growing wireless properties.
 For the quarter ended Dec. 31, Verizon reported earnings of $2.1 billion, or 77 cents a share, compared with earnings of $2.1 billion, or 75 cents a share a year earlier.
Analysts did not issue a fourth-quarter forecast since the company only formed last summer through the merger of Bell Atlantic and GTE Corp.
Excluding gains from its U.S. wireless properties, the company earned 70 cents a share for the quarter.
Revenue totaled $16.9 billion, up from $15.3 billion a year earlier.
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"Our solid operating performance in 2000 confirms both the validity of our business model and our ability to execute on it," Chairman Charles Lee said.
Verizon derived nearly 40 percent of its quarterly revenue from data, wireless, long-distance, DSL (digital subscriber line) and international services.
While the long-distance business saw a 44 percent increase in subscribers to 4.9 million, Wall Street has its eyes on the company's wireless unit, which last week came away with the lion's share of wireless licenses in a Federal Communications Commission auction.
Verizon Wireless is the No. 1 U.S. wireless telephone service provider.
Sprint profit races past forecasts
Meanwhile, Sprint's long-distance service earned 41 cents a share in its fourth quarter, two cents better than Wall Street expectations, but sharply lower than the 49 cents a share it earned a year ago.
Analysts expected a profit of 39 cents a share, according to earnings tracker First Call. Revenue was flat at $4.4 billion in the quarter.
The company also issued a warning about 2001 results, saying its investment in Brazilian telecommunications operations could cause it to fall short of estimates by 8 cents a share.
It also warned that first-quarter earnings would reach the upper 30 cents range rather than the 44 cents a share forecast by analysts.
Kansas City-based Sprint reported a 14 percent decline in fourth-quarter income from continuing operations at its long distance unit to $359 million from $417 million a year ago.
The company blamed a highly competitive long-distance market, in which voice revenue declined 4 percent in the quarter from a year ago.
The company also said voice revenue could see further declines in the mid-to upper single-digit-rates.
However, the company's wireless business, Sprint PCS Group, saw revenue increase 84 percent to $1.94 billion in the quarter compared with $1.06 billion a year ago. The unit added nearly 4.1 million subscribers, raising the total 70 percent from a year earlier.
"I am extremely pleased with Sprint's performance this year, and I continue to be very optimistic about Sprint's future growth," CEO William Esrey said.
Shares of Verizon (VZ: Research, Estimates) gained $1.06 to $54.95 Wednesday. Sprint (FON: Research, Estimates) long-distance shares slipped 55 cents to $24.80.
From staff and wire reports 
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