NEW YORK (AP) — Verizon Wireless, the country’s largest cellphone carrier, on Thursday said it’s joining AT&T and T-Mobile in providing an installment plan for its phones, aiming to satisfy customers who want to upgrade their devices faster or avoid paying the upfront cost of their phones.
The plan, dubbed Edge, will be introduced Aug. 25, and will allow the buyer to spread the full retail price of the phone, without subsidies, over 24 months. A buyer who has paid off 50 percent of the cost of the phone can upgrade to a new phone after six months.
“We have a lot of customers in the technology edge that want to upgrade sooner than they would under our historical, legacy, subsidy model, if you will. And we have other customers who don’t want to pay upfront for the large cost of the phone,” Verizon Communications Inc.’s chief financial officer, Fran Shammo, told analysts on a conference call Thursday.
On Tuesday, AT&T announced its own frequent-upgrade option, called “Next.” Starting July 26, customers will be able to buy their phones on installment plans, with the option to trade in the devices after a year.
Shammo made his comments while discussing the company’s second-quarter results on a conference call with analysts.
Verizon Wireless added 941,000 devices to its contract-based plans in the April-to-June period, exceeding analyst estimates and continuing a strong run. It boosted service revenue by 8.3 percent from a year ago. Its closest rival, AT&T, is seeing revenue increases of around 4 percent.
Almost all of the gains on the wireless side were due to customers upgrading to higher-priced plans or adding more devices, as opposed to an influx of new customers.
SAN FRANCISCO (AP) — Google’s financial performance faltered in the second quarter as a downturn in the Internet search leader’s ad prices deepened.
The results announced Thursday show Google is still having trouble navigating a technological transition driving more online activity on to smartphones and tablets. Those devices pose a challenge because their smaller screen sizes fetch lower ad rates than on traditional desktop and laptop computers.
Google Inc.’s average ad rate fell by 6 percent from the same time last year during the three months ending in June. It marks the seventh consecutive quarter of falling ad prices.
Google earned $3.2 billion, or $9.54 per share, up 16 percent from $2.8 billion, or $8.42 per share, a year earlier. Revenue rose 19 percent to $14.1 billion.
ARMONK, N.Y. (AP) — IBM said Wednesday that its second-quarter net income fell 17 percent as revenue slipped and it absorbed the cost of layoffs.
Net income came to $3.23 billion, or $2.91 per share, down from $3.88 billion, or $3.34 per share, a year earlier.
The parent of American Airlines posted a $220 million second-quarter profit as cost-cutting from its bankruptcy reorganization kicked in.
It’s the first time in six years that American has reported a profit during the April-June quarter. During the same period last year, it lost $241 million, mostly because of bankruptcy related expenses.
Revenue was steady at about $6.45 billion.
AMR Corp. has been operating under bankruptcy protection since late 2011. It has cut worker pay and other expenses. Spending for wages was 18 percent lower than a year ago. Fuel expenses fell 3 percent.
American is seeking approval for a merger with US Airways Group Inc. – The Associated Press
HELSINKI (AP) — The sales decline at struggling cellphone maker Nokia Corp. continues with revenue dropping almost a quarter between April and June compared with the same time last year, the company announced Thursday.
The Finnish company’s second-quarter sales declined to 5.7 billion euros ($7.49 billion) from 7.5 billion euros in the same period last year. Nonetheless, Nokia’s cost-cutting program helped it trim its net loss to 227 million euros, compared with a net loss of 1.41 billion euros a year earlier.
The company said it would continue to reduce costs and may cut up to 440 jobs globally in its mobile phones business.
Sales of the company’s Lumia phones in the second quarter increased by 32 percent, compared with the first three months of the year, to 7.4 million handsets — but this was still at the lower end of analysts’ expectations.
Microsoft Corp.’s profit missed analysts’ projections as Windows sales were hurt by shrinking demand for personal computers and the company wrote down the value of unsold inventory of its Surface tablet.
Excluding a 7-cent charge related to the inventory adjustment, fourth-quarter profit was 66 cents a share, Microsoft said Thursday. Sales rose 10 percent to $19.9 billion. Analysts had predicted profit of 75 cents a share on $20.7 billion in revenue, according to the average of estimates compiled by Bloomberg.
Windows sales are being besieged by poor demand for PCs, reflected in five consecutive quarters of declining shipments, which researcher IDC predicts will be the worst annual drop on record. It’s a slide the company’s new Windows 8 software has failed to arrest.
Chief Executive Officer Steve Ballmer is reorganizing the world’s largest software maker to try to spur better performance in areas like mobile computing as consumers gravitate to tablets and smartphones. – Bloomberg News