RSSVerizon Communications reported its second-quarter and half-year 2022 results.
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"As the market leader, in a very competitive industry, we are determined to improve our operational and financial performance for the second half of the year,” said Verizon Chairman and CEO Hans Vestberg. "With our network-as-a-service foundation, our new consumer mobility plans, and recent pricing actions, we are being deliberate in our decisions to improve our profitable growth opportunities today and into the future."
For second-quarter 2022, Verizon reported earnings per share (EPS) of $1.24, compared with $1.40 in second quarter 2021. On an adjusted basis, excluding special items, EPS was $1.31 in second-quarter 2022, compared with adjusted EPS1 of $1.39 in second-quarter 2021.
Second-quarter 2022 EPS included a pre-tax loss from special items of approximately $435 million, including a net pre-tax charge of $198 million related to a mark-to-market adjustment for pension liabilities. In addition, the impact of amortization of intangible assets related to TracFone and other acquisitions was $237 million.
"Although recent performance did not meet our expectations, we remain confident in our long-term strategy,” said Verizon Chief Financial Officer Matt Ellis. “We believe that our assets position us well to generate long-term shareholder value."
Total consolidated operating revenue was $33.8 billion, relatively flat from second quarter 2021. Wireless service revenue growth and higher wireless equipment revenue were offset primarily by wireline declines and the net impact of merger and acquisition (M&A) activity in 2021.
Service and other revenue declined 3.9% year over year in second-quarter 2022, as the revenue lost from Verizon Media more than offset net incremental revenue from the company's acquisition of TracFone.
Net income was $5.3 billion, a decrease of 10.7% from second-quarter 2021, and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $11.9 billion, a decline of 2.6% year over year, due to the divestiture of Verizon Media, higher device subsidies and promotional spending associated with increased wireless activations, wireline revenue declines and inflationary cost pressures.
First-half 2022 cash flow from operating activities totaled $17.7 billion, compared with $20.4 billion in first-half 2021. The reduction was primarily due to working capital impacts from higher device activations, and increased inventory levels as part of the company's supply chain management in the current environment. Capital expenditures in first-half 2022 were $10.5 billion, including C-Band spending of $2.8 billion.
Verizon is updating financial guidance for full-year 2022. The company now expects reported wireless service revenue growth of 8.5 to 9.5%, an update from prior guidance for reported wireless service revenue growth of 9 to 10%.
The company expects reported service and other revenue growth of -1% to flat, an update from prior guidance for reported service and other revenue growth to be approximately flat. Adjusted EBITDA growth is expected to be -1.5% to flat, an update from prior guidance for adjusted EBITDA1 growth of 2 to 3 percent. Adjusted EPS is expected to be $5.10 to $5.25, an update from prior guidance for adjusted EPS of $5.40 to $5.55.
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