Verizon Shakes Off iPhone Onslaught

Verizon (VZ Quote - Cramer on VZ - Stock Picks) says the iPhone wave has already crested.

The New York telco told investors on a conference call Monday that June's rollout of the Apple (AAPL Quote - Cramer on AAPL - Stock Picks) smartphone by rival AT&T (T Quote - Cramer on T - Stock Picks) cost Verizon some customers. But execs added that defections have since slowed and Verizon has resumed taking customers from all its competitors, including AT&T.

The iPhone helped AT&T win 58,400 customers from rivals like Verizon Wireless, according to comments made by AT&T on its earnings call last week. The company said it activated 146,000 iPhone accounts during its second quarter ended June 30, and AT&T estimated 40% of those activations came from customers leaving another carrier -- such as Verizon Wireless and Sprint (S Quote - Cramer on S - Stock Picks).

On an earnings conference call with analysts Monday, Verizon executives said that by the first weeks of July, Verizon saw negative so-called porting rates -- meaning more Verizon customers were switching to AT&T than vice versa.

But as the month progressed, Verizon said it has seen a shift back to what it calls normal switching rates. "We are now seeing two Verizon Wireless customers in for every one we lose," says COO Denny Strigl.

So far, then, the iPhone hasn't yet proven to be the juicy bait that AT&T was hoping it could dangle to lure the best customers from other carriers.

Industry observers note that AT&T's iPhone storm hasn't fully passed. The holiday season will probably be an active time for expensive phone gifts, and the iPhone is likely to be on a few wish lists.

Despite solid second-quarter numbers, Verizon shares fell $1.02 to $40.98.