Verizon Communications Inc. said Thursday its fourth-quarter profit fell sharply due to expenses related to the freezing of a management retirement plan.
The New York-based telephone company said it earned $1.7 billion, or 59 cents per share, in the last three months of 2005, down from $3 billion, or $1.08 a share, a year ago.
Excluding items, the latest results matched the mean estimate of 64 cents a share in a survey of analysts by Thomson Financial. Earnings in the fourth quarter of 2004 were also 64 cents a share, excluding gains from divestments and tax benefits.
Revenue was $19.3 billion, up 5.8 percent from $18.3 billion in the fourth quarter of 2004.
Verizon Wireless, owned in partnership with Vodafone Group PLC, accounted for $8.7 billion of the revenue total, up 18.3 percent from the fourth quarter of 2004.
The wireless venture added a net 2 million wireless subscribers in the quarter, up 20.5 percent over the fourth quarter of 2004. It ended the year with 51.3 million subscribers, just short of Cingular Wireless LLC's 54.1 million subscribers.
Another wireless competitor, T-Mobile USA Inc., said Thursday it added 1.4 million subscribers in the fourth quarter, for a total of 21.7 million. T-Mobile USA is a unit of Germany's Deutsche Telekom AG.
Verizon's landline business continued to decline. It served 49 million lines at the end of the year, down 6.7 percent from 52.3 million the year before. However, average revenue per customer rose 3.9 percent to $51.50 due to the demand for extra services.
The company has started replacing the copper wires leading into homes with fiber-optic cables. The fiber network is now available to 3 million homes and businesses.
Verizon has also started to sell video programming over fiber optics, competing with cable companies, but that rollout has been slowed down by the need to obtain permission from local authorities. Earlier this week, Verizon started selling its FiOS TV service in two towns in New York and Massachusetts, adding to the areas served in Texas, Florida and Virginia.
Verizon said 21 percent of households eligible for video service in the Dallas suburb of Keller had signed up, four months after the service launched.
Verizon's full-year earnings were $7.4 billion, or $2.65 a share, on revenue of $75.1 billion. Earnings in the previous year were $7.83 billion, or $2.79 per share, on revenue of $71.3 billion.