Verizon feels the effects of the coronavirus, although not so hard

Both Verizon Communications and AT&T were affected by the COVID-19 outbreak in March, but their networks did not collapse as millions of families turned to broadband and mobile Internet for their core communications.

Verizon and AT&T have risen 14% and 10% respectively over the past month, as investors seek stabilization signals during the economic downturn due to the pandemic.

However, the crisis has not passed telecommunications operators.

Despite virus-related effects that wiped 4 cents per share from Verizon’s first-quarter earnings, the company still managed to exceed Wall Street’s earnings expectations. But revenue has fallen below projections and the company is reviewing its annual financial forecast for the pandemic.

Verizon said its annual adjusted earnings would drop, and its revenue forecast was withdrawn.

Previously, the company expected its profits to grow by between 2% and 4%. Analysts expected there would be no profit growth and a 1% decrease in revenue for 2020.

Q1 earnings came in at 1.26 USD per share, exceeding the forecast of 1.22 USD per share, while revenue of 31.6 billion USD was below analysts’ expectations of 32.38 billion USD.

Verizon has run into problems closing its stores, and its revenue has also suffered from waiving sanctions on customers who exceed their data limit. The weaker forecast for the company reflects what is happening to other players in the sector such as AT&T, which lost 5 cents per share of its profits in the first quarter due to the coronavirus.

Verizon has given 5.3 billion USD in capital investments, including improvements to the network. The company is competing with AT&T and T-Mobile US to attract the first 5G users. The company plans to launch 5G services in the country this year.