Verizon says economy not hurting its results

In announcing second quarter results today, Verizon officials repeatedly said the slowing U.S. economy is not having a major impact on its financial results. Verizon Wireless, Verizon Telecom and Verizon Business all are performing up to expectations, according to Verizon COO Dennis Strigl and CFO Doreen Toben. Those comments came despite the fact that Verizon continues to bleed local access lines and saw a net-loss of DSL subscribers for the first time.

Not even the wildly successful 3G iPhone launch by rival AT&T rained on Verizon’s second-quarter parade, according to Strigl.

“As we saw with initial introduction of Apple’s iPhone, we are seeing the same, minimal short term impact” for the 3G launch, Strigl said. “It has been disproportionately less than our relative market share. Apple iPhone has caused a stimulation in the sales of smart phones. We are now at over 30% of handset sales with smart phones. Since the iPhone hit the market, we continue to be well-positioned and our continued success reflects that.”

Verizon Wireless was at the core of the financial performance, as Verizon added 1.5 million customers net, 97.5 percent of which are post-paid, and posted double-digit revenue growth and service revenue growth, with reduced churn.

Verizon Business’ revenues were up about one percent, driven by 18% growth in managed services, Ethernet and other advanced data offerings. Despite the economic downturn in the U.S., enterprise revenues have not bee hit sharply. Verizon Business’ global sales are helping boost its overall performance, Toben said. “Before we had MCI, we had no global,” she said. “Now there is a significant piece of our business that is global that is growing nicely.”

Much of that growth comes from multinationals based in the U.S., and from selling consulting services, security services and other advanced offerings on top to the global IP network that Strigl believes gives Verizon Business a leg up on the competition.