Most of the revenue drop is due to its sale of assets, according to Forbes.com:
The latest quarterly profit reflected a charge of $541 million, or 19 cents per share, for taxes owed due to the sale of Verizon operations in the Dominican Republic. It also included 8 cents worth of costs related to the spinoff of the company's phone book and online directories business, as well as severance, pension, merger integration and headquarters relocation expenses.
And next quarter - after Venezula takes over the phone company that VZ has a big stake in - there will be more losses.
For the final three months of 2006, Verizon earned $1.03 billion. Fourth-quarter revenue totaled $22.60 billion, a 26.1 percent increase compared with $17.93 billion in the same period in 2005, though a big chunk of that gain came from the acquisition of the MCI long-distance business in early 2006.
Amazing that VZW had a "net gain of 2.3 million customers" compared to Cingular with a "net gain of 2.4 million". VZW (co-owned with Vonafone) "Revenue grew 16.3 percent to a market-leading $10.10 billion" with a churn rate of "1.14 percent of the customer base per month."
"Verizon's local and long-distance phone business continued to shrink (down 3.5% from last year), but the revenue decline was reduced by growth in customers for DSL Internet access, the new FiOS broadband and TV network, and the former MCI's corporate services. Phone line loss was 900,000 lines. "Verizon stressed that the consumer operation's loss of 366,000 residential phone lines was more than offset by a gain of 409,000 broadband lines for a year-end total of roughly 7 million. That included 165,000 new customers for FiOS Internet....At year-end, FiOS Internet was available to 4.8 million homes with 687,000 customers, a penetration rate of 14 percent....Subscribers to FiOS TV grew by 89,000 for a year-end total of 217,000. That represented a penetration rate of 9 percent among the 2.4 million homes that had access to FiOS TV."