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Verizon Swings to Profit

Revenue dips and the bottom line is boosted by an accounting gain.
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(VZ) - Get Verizon Communications Inc. Report

earned close to $4 billion in the first quarter, helped by an accounting gain, while revenue fell slightly because of the sale of switched-access lines since the year-ago quarter.

The telecommunications giant earned $3.9 billion, or $1.41 a share, on revenue of $16.3 billion in the latest quarter. The earnings included a gain of $2.1 billion, or 77 cents a share, from an accounting change. In the year-ago quarter the company lost $500 million, or 18 cents a share, on $16.4 billion in revenue.

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The company noted that the year-ago quarter included revenue of $241 million from switched access lines that have since been sold.

Excluding one-time items including pension income, Verizon earned 62 cents a share. Excluding the accounting change, it earned 63 cents a share. Analysts had been forecasting earnings of 63 cents.

At Verizon Wireless, revenue rose 14.8% to $5.1 billion as total customers rose 12.6% to 33.3 million. The company had 833,000 net additions in the quarter.

Verizon said it still expects comparable revenue in 2003 to be flat to up 2%, capital expenditures of $12.5 billion to $13.5 billion, and year-end net debt of $49 billion to $51 billion. The company expects to earn $2.70 to $2.80 a share in the full year.