Verizon (VZ 47.88, -1.06) is down 2.1% after reporting disappointing results for the first quarter.
The telecommunications giant reported below-consensus earnings of $0.95 per share on a 7.3% year-over-year decline in revenue to $29.81 billion, which was also shy of market expectations.
Decreased overage revenue, lower postpaid customers, and continued promotional activity contributed to the decline in revenue. Wireless revenue fell 5.1% to $20.90 billion.
The company launched Verizon Unlimited in mid-February in response to growing competition in the wireless arena. The launch of the Unlimited plan had a positive impact on the trajectory of customer additions, but did not stop the company from seeing its retail postpaid connections decline by 289,000. The company added 49,000 smartphones to its postpaid phone base, which grew 1.2% year-over-year to 108.5 million.
Retail prepaid connections increased 0.5% to 5.4 million. Retail postpaid churn increased 19 basis points to 1.15% due to increased churn in tablets. Retail postpaid phone churn was below 0.90% for the eight quarter in a row.
Capital expenditures declined to $3.07 billion from $3.39 billion one year ago.
Total Wireline revenue decreased 0.6% to $7.90 billion, which overshadowed a 4.7% year-over-year increase in total Fios revenue, which grew to $2.90 billion. Consumer markets revenue grew 0.7% while business markets revenue increased 2.3%.
Verizon expects that organic consolidated revenue in 2017 will be consistent with levels from 2016. Consolidated capital spending is expected to be between $16.80 billion and $17.50 billion in 2017.
Including today's early decline, shares of Verizon are now down 10.3% so far in 2017 versus a 7.2% year-to-date decline in the S&P telecom services sector.