Verizon grounded by $1bn loss

Verizon has posted a second quarter loss of $1bn and has subsequently delayed the float of Verizon Wireless, its joint venture with Vodafone.

The loss, for the New York based telco, included a $2.1bn write-off for the reduced value of investments made in Cable & Wireless, NTL and US network operator Metromedia.

The $1bn loss compares to a net profit of $4.9bn in the same period last year.

Fred Salerno, Verizon chief financial officer, said in a company statement that additional job cuts may be added to the 16,000 already announced over the past year.

Excluding charges, net profit was $2.1bn, compared to $1.97bn a year ago. Revenue was $16.9bn, compared to $16.3bn in the same period a year earlier.

Positive growth was registered in Verizon's long-distance operations with customers now totaling more than 6m and its DSL arm having grown from 120,000 to 840,000.

However, it lowered its April growth targets for 2001 from 7 per cent to between 5 per cent and 6 per cent.

On the close of Nasdaq yesterday evening, shares had dropped 3.34 per cent to $54.15 from $56.02 per share.

Regarding the Verizon's relationship with Vodafone, a spokesman for the company confirmed to silicon.com that the relationship has not changed and said it is up to Verizon when the floatation takes place, not confirming whether it will happen before the end of the year.