Verizon, buoyed by strong wireless subscriber growth, topped Wall Street estimates for its third quarter earnings on Tuesday, despite the underwhelming performance of its media division.
For the three months ending Sept. 30, Verizon posted earnings of $1.22 per share and revenue of $32.6 billion — inching past analyst estimates of $1.19 per share and $32.5 billion in sales. Revenue increased 3 percent year-over-year.
The largest wireless company in the U.S. added 295,000 postpaid phones during the quarter, running past analyst estimates of about 160,000 new customers. But the company’s postpaid wireless subscribers came in at 515,000, missing analyst estimates by about 30,000 and falling short of the mark it hit during the second quarter. Verizon had 116.8 million wireless connections at the end of Q3.
Oath, which brought together Yahoo, Huffington Post and AOL under one roof, remained a disappointment for Verizon. The media division brought in $1.8 billion in revenue, marking a 7 percent drop year-over-year. Verizon said it expects Oath’s growth to remain flat through the end of 2018, and that the company doesn’t anticipate hitting its goal of $10 billion in Oath revenue by 2020. Oath’s struggles to lure online advertisers comes as Tim Armstrong, the company’s chief executive, announced his exit last month.
Still, with its core business posting an impressive quarter, investors overlooked Oath’s struggles, with Verizon shares increasing 3.5 percent in early morning trading to $56.90 a share.
The company touted its aggressive 5G rollout as a sign it’ll continue being the dominant wireless company in the U.S.
“With the beginning of the 5G era in this fourth quarter, we expect that trend to continue,” CEO Hans Vestberg said in a statement accompanying earnings. “We are investing in networks, creating platforms to add value for customers and maintaining a focused, disciplined strategy.”