July 22 (Bloomberg) -- Verizon Communications Inc. fell the most in three months in New York trading after losing to AT&T Inc. in the battle for iPhone customers in the second quarter.
Verizon Wireless, the country’s largest wireless carrier, said today it activated 2.3 million of the handsets made by Apple Inc. in its first full quarter of selling the device. AT&T said yesterday it switched on 3.6 million devices in the period, including the older 3GS model, which it sold for $49.
Verizon, which doesn’t have the older model, sells its iPhone 4 starting at $199. The New York-based company is awaiting a newer version of the Apple handset to help it meet a target to have 50 percent of its contract subscribers using smartphones, up from 36 percent at the end of June.
“It will be the first time that we’re supposed to have a phone that’s at parity,” Verizon Chief Financial Officer Fran Shammo said today in a phone interview, referring to a new iPhone model. “Today we don’t. They have a different phone at $49 than we have.”
Verizon, which co-owns Verizon Wireless with Vodafone Group Plc, fell 83 cents, or 2.2 percent, to $36.74 at 4 p.m. in New York Stock Exchange composite trading, the biggest drop since April 21. Dallas-based AT&T rose 4 cents to $30.32.
Verizon also reported second-quarter profit of 57 cents a share, after a loss a year earlier, topping the 55-cent average of estimates compiled by Bloomberg.
IPhone 5 Debut
Investors may be disappointed with Verizon’s second-quarter figure for monthly revenue per subscriber, said Christopher Larsen, an analyst at Piper Jaffray & Co. in New York who has a neutral rating on Verizon shares. The figure rose 1.9 percent from a year earlier to $54.12, compared with the $54.62 average estimate of four analysts compiled by Bloomberg.
The revenue-per-subscriber figure includes data devices such as portable wireless routers, laptop cards and tablet computers. Average revenue per contract mobile-phone subscriber grew faster, up 3.2 percent from a year earlier, Verizon said.
Verizon had expected a new iPhone around June, when Apple has normally introduced upgraded versions, to help the carrier reach its forecast of 50 percent smartphone use by the end of the year, Shammo said in the interview. The company probably won’t reach that target until the end of next year’s first quarter, he said.
He referred to the next version of the device as iPhone 5.
Smartphone users represent 50 percent of AT&T’s contract subscribers, the company said yesterday.
(Verizon held a conference call this morning to discuss the results. To listen, go to LIVE <GO>.)
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