VZW stretches legs in Q1, scores 1.7M net additions

Verizon Wireless again staked its claim as the industry’s fastest growing wireless carrier posting 1.7 million net customer additions during the first quarter. Larger rival AT&T Inc. last week posted 1.2 million net additions for the quarter in its wireless division, and analysts expect No. 3 carrier Sprint Nextel Corp. and No. 4 carrier T-Mobile USA Inc. to each post less than one million net additions.
In addition to blowing away the competition in total customer growth, Verizon Wireless noted that direct customer additions totaled 1.6 million subscribers for the quarter. The carrier ended the first three months of the year with 58.5 million direct customers on its network, which it claimed was the most of any domestic operator. Verizon Wireless had a total of 60.7 million customers at the end of quarter, just short of AT&T’s 62.2 million customers.
Boosting Verizon Wireless’ strong growth was a 1.08 percent customer churn rate, which dropped from the 1.2 percent posted during the first quarter of 2006, and a 2.1-percent increase in gross customer additions to 3.6 million subscribers for the quarter. Analysts said they expected strong customer gross additions for Verizon Wireless at the expense of struggling Sprint Nextel.
Average revenue per user increased 4.2 percent from $48.67 during the first quarter of 2006 to $50.73 this year, but was flat sequentially. The carrier noted that data ARPU increased 54 percent year-over-year to $8.95, and that it had 36 million data customers at the end of the first quarter.
The strong ARPU growth helped push Verizon Wireless’ total revenues to $10.3 billion for the quarter, a 17-percent increase compared with the $8.8 billion posted during the first quarter of 2006. Operating income jumped 29 percent from $2.1 billion to $2.7 billion.