Verizon said Friday that it sold 2 million iPhones during the last quarter, but acknowledged that demand for a new iPhone hurt sales of the popular Apple smartphone in the last few months.
Device sales were down in the last few months, "due primarily to customer anticipation of the next iPhone," Fran Shammo, executive vice president and chief financial officer, said during a conference call with analysts.
That device is, of course, the iPhone 4S. Shammo declined to give exact numbers on how many 4S devices Verizon has sold, except to say that the company is "extremely pleased" with sales. "We ran out on the first day," Shammo said. Verizon did not see a large shift in the number of new iPhone customers; it remained at 20 percent new customers and 80 percent existing customer upgrades.
Yesterday, AT&T said it has sold 1 million iPhone 4S smartphones, and Apple this week revealed that customers have snapped up 4 million iPhone 4S devices since launch. But both companies also admitted that the buzz around the possible launch of a revamped iPhone in the fall prompted customers to hold off buying the iPhone 4. Those rumors, which centered primarily on a totally upgraded "iPhone 5" didn't come to pass, but any disappointment with the iPhone 4S has apparently not hurt sales.
Overall, Verizon has sold 6.5 million iPhones since they debuted on the network in February.
On the non-iPhone front, Shammo said that 52 percent of retail postpaid customers are now using 4G LTE smartphones and Internet devices, up from 30 percent during the last quarter. Verizon sold 1.4 million 4G LTE devices in the quarter, and just over half were smartphones, he said.
Verizon had a bit of a rough quarter, with worker strikes and Hurricane Irene, both of which cost the company about $250 million, Shammo said.
"These storms were a really big deal for us," he said, pointing to the 20 inches of rain that accumulated across the Verizon footprint.
The company had more than 4,000 downed poles, damage to cables, and 254 central offices that were running off of generators.
While the strike ended in August, meanwhile, negotiations are ongoing. "We continue to speak to the unions," Shammo said. "It's going as any negotiations go. At this point, it's too early to tell where we'll come out."
Shammo insisted that the current business model is "not sustainable" with 100 percent benefits and pensions. Things need to change in order to remain competitive, he said.