Verizon Propped Up by Wireless Gains

The New York phone giant had mediocre fourth quarter numbers, except in wireless.
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NEW YORK (TheStreet) -- Verizon (VZ) - Get Report delivered weak fourth quarter numbers that came up short in nearly every category except the most important one -- wireless subscriber growth.

The phone service giant posted adjusted earnings of 54 cents a share, down from the 61 cents adjusted profit in the year-ago quarter and in line with analysts' estimates, according to Yahoo! Finance.

Sales for the quarter that ended last month were $27.1 billion, a 10% increase over the year-ago top line, but below the $27.3 billion analysts had targeted.

Verizon added 2.2 million net new wireless subscribers with 1.23 million of those users direct retail customers. That is a strong performance in the face of record


(AAPL) - Get Report

iPhone sales at rival


(T) - Get Report

. Verizon clearly saw strong demand for its



Droid phones and BlackBerries from

Research In Motion



But in other areas like Verizon's fiber optic network services or FiOS, the company posted a bleak performance. Verizon added 153,000 FiOS Internet subscribers, which was well below the 234,000 Wall Street was anticipating. And new FiOS TV subscribers were a mere 150,000, also missing the mark of 224,000 analysts had expected.

"In last year's turbulent economy, we took significant steps to strengthen Verizon going forward," CEO Ivan Seidenberg said in a press release. "We focused on expanding wireless data and set the stage to deploy a nationwide 4G network later this year."

One particularly troubling sign in the fourth quarter was the big increase in debt. Verizon's total debt grew 15% to $62.25 billion from year-ago levels. Helping to offset that debt pressure was Verizon's operating cash flow, which grew 14% to $31.5 billion compared to the same period a year ago.

Looking ahead, Verizon says it will keep its capital spending at about $17 billion this year, which is unchanged from the 2009 outlay.

Verizon shares were down less than a percentage point to $30.65 in premarket trading Tuesday.

-- Reported by Scott Moritz in New York.