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Did Verizon Beat Earnings Estimates in 1Q18?



Verizon’s earnings in 1Q18

Verizon Communications (VZ) reported its 1Q18 results on April 24. Verizon’s earnings beat the consensus Wall Street estimate by ~5.4%, and its adjusted EPS (earnings per share) rose ~23.2% YoY (year-over-year) to reach $1.17 in 1Q18.

Excluding the net effects of tax reform and the adoption of its revenue recognition standard, Verizon’s adjusted EPS increased ~1.1% YoY to reach $0.96 in 1Q18.

Verizon’s adjusted EBITDA[1. earnings before interest, tax, depreciation, and amortization] increased ~9.1% YoY to reach $11.8 billion in 1Q18. Year-over-year, the company’s consolidated adjusted EBITDA margin expanded during the quarter. Verizon’s adjusted EBITDA margin increased from ~36.5% in 1Q17 to ~37.1% in 1Q18, supported by higher wireless margins.

During the quarter, the company’s Wireless segment’s EBITDA increased ~11.3% YoY to reach $10.5 billion. The Wireline segment’s EBITDA decreased ~4.6% YoY to reach $1.6 billion during the quarter.

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Stock price reaction

Verizon (VZ) stock reacted positively to the company’s earnings report, rising ~2.1% on April 24. That day, telecom peers T-Mobile (TMUS), AT&T (T), and Sprint (S) rose ~0.5%, ~0.3%, and ~0.5%, respectively.

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