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Verizon beats expectations with 47 percent profit growth

Thursday, April 28, 2005 | 9:39 a.m.

NEW YORK -- Demonstrating its financial might as the country's largest telecommunications carrier, Verizon topped Wall Street's expectations Wednesday by reporting 47 percent profit growth in the first quarter on strong sales of wireless and Internet products.

Verizon, locked in a battle with Qwest for the right to buy MCI, made no mention of its next move on the merger front. Qwest has been trying to break up Verizon's deal to acquire MCI by offering more money. Verizon has until Friday to raise its bid; otherwise, it runs the risk of losing the support of MCI's board.

Qwest, with $14.8 billion in annual revenue and more than $17.5 billion in debt, is a relatively weak carrier. Verizon, by contrast, has annual revenue exceeding $70 billion. It's also the controlling partner in Verizon Wireless, the No. 2 wireless carrier.

The sharp difference between MCI's two suitors was driven home Wednesday by Verizon's boffo earnings report. For the first quarter, Verizon recorded a profit of $1.8 billion, or 63 cents a share. Revenue rose 6.6 percent to $18.2 billion.

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