Verizon reported a 2% year-on-year fall in revenues for the second quarter, after excluding the impact of divestments and acquisitions, to 30.5 billion US dollars. Wireless service revenue was down 6.7% year-on-year, while wireline revenue was down 2.8%, after excluding the impact of the acquisition of XO Communications. Verizon said its organic telematics and Internet of Things revenue rose 20% year-on-year, while telematics revenue alone totalled 220 million dollars.
Matt Ellis, CFO of Verizon, said the decline in wireless service revenue "was primarily due to the lost overage revenue, driven by plans introduced during summer of 2016 and the introductory unlimited offer. .. At the end of the second quarter, about 59% of our accounts have tools that offer customers the ability to self-manage their usage experience.
"During the second quarter, we experienced an improvement in the rate of decline in line access revenue as we now have roughly 75% of the postpaid phone base on unsubsidized plans. We expect this trend will continue, which, combined with adding new accounts and migrating customers to higher access points, will mitigate the lost overage revenue. Therefore, we believe the service revenue trend has flattened. And we expect that there will be an improving trend in the second half and we should exit the fourth quarter inside a decline of 4.0%." Source: transcript of Verizon earnings call.