93 cents in diluted earnings per share (EPS), including 39 cents per share in net non-operational gains, compared with 22 cents in EPS (as adjusted) in 4Q 2009, including 28 cents per share in non-operational charges.

Continued cash flow growth in quarter, contributing to $33.4 billion in cash flow from operations in 2010 and $16.9 billion in free cash flow (non-GAAP).

7.7 percent increase in service revenues from 4Q 2009; data revenues up 25.5 percent; 30.1 percent operating income margin and 47.5 percent Segment EBITDA margin on service revenues (non-GAAP).

955,000 total net customer additions, excluding acquisitions and adjustments, in 4Q 2010; includes 872,000 retail postpaid net customer additions in the quarter; continued low retail postpaid churn of 1.01 percent.

102.2 million total connections, includes 94.1 million total customers.

197,000 net FiOS Internet and 182,000 net FiOS TV customer additions; 4.1 million total FiOS Internet customers and 3.5 million total FiOS TV customers.

10.7 percent increase in consumer ARPU from 4Q 2009; FiOS revenues now represent approximately 53 percent of total consumer revenues.

7.5 percent increase in strategic enterprise revenues, which now represent approximately 44 percent of total global enterprise revenues.

Verizon Wireless added 872,000 retail postpaid customers, and 803,000 total retail customers, which includes a decrease of 69,000 retail prepaid customers. These additions exclude acquisitions and adjustments.

At the end of the fourth quarter, the company had 87.5 million retail customers, which represented 93 percent of the company’s wireless customers.

The company also added 152,000 reseller customers in the fourth quarter.

The company had a total of 94.1 million customers at the end of the fourth quarter. In addition, the company had 8.1 million other connections -- such as machine-to-machine and telematics. This was an increase of 186,000 net other connections in the quarter, and brought the number of total wireless connections to 102.2 million at year-end 2010.

At year-end 2010, 26 percent of Verizon Wireless’ retail postpaid customer base had smartphone devices, up from 15 percent at year-end 2009. In fourth-quarter 2010, more than 75 percent of Verizon Wireless’ postpaid net adds were smartphones.

Retail postpaid churn remained low at 1.01 percent. Total retail and total customer churn levels were 1.37 and 1.34 percent, respectively. All churn levels improved year over year and sequentially.

Retail service revenues in the quarter totaled $13.5 billion, up 5.1 percent year over year. Retail data revenues were $5.0 billion, up 22.8 percent year over year. Service revenues in the fourth quarter were $14.2 billion, up 7.7 percent year over year. Total revenues were $16.1 billion, up 5.7 percent year over year. For full-year 2010, service revenues were $55.6 billion, up 6.9 percent over full-year 2009; total revenues were $63.4 billion, up 5.1 percent year over year.

Retail postpaid ARPU grew 2.5 percent over the fourth-quarter 2009, to $53.50. Retail postpaid data ARPU increased to $19.97, up 19.3 percent year over year. In addition, retail service ARPU grew 2.4 percent over fourth-quarter 2009, to $51.84.

Wireless operating income margin was 30.1 percent, an increase of 340 basis points year over year. Segment EBITDA margin on service revenues (non-GAAP) was 47.5 percent, up 290 basis points over fourth-quarter 2009. For full-year 2010, operating income

margin was 29.5 percent, up 190 basis points over full-year 2009; segment EBITDA margin on service revenues was 46.9 percent, up 140 basis points.

Verizon added 197,000 net new FiOS Internet customers and 182,000 net new FiOS TV customers. By year-end, Verizon had 4.1 million FiOS Internet and 3.5 million FiOS TV customers.

FiOS Internet penetration (customers as a percentage of potential customers) was 31.9 percent by the end of the quarter, with the product available for sale to 12.8 million premises. This compares with 28.3 percent and 11.6 million, respectively, at year-end 2009.

FiOS TV penetration was 28.0 percent by the end of the quarter, with the product available for sale to 12.4 million premises. This compares with 24.7 percent and 11.1 million, respectively, at year-end 2009.

FiOS revenues generated approximately 53 percent of consumer wireline revenues in fourth-quarter 2010, compared with approximately 50 percent in third-quarter 2010.

Total wireline broadband and video revenues -- including FiOS Internet, FiOS TV and HSI (DSL-based high-speed Internet) -- were $1.8 billion in the quarter, up 18.4 percent from fourth-quarter 2009.

Consumer revenues grew 1.6 percent compared with fourth-quarter 2009. Consumer ARPU for wireline services was $88.85 in fourth-quarter 2010, up 10.7 percent compared with fourth-quarter 2009. ARPU for FiOS customers is more than $146.

Global enterprise revenues totaled $4.0 billion in the quarter, up 1.3 percent compared with fourth-quarter 2009. Sales of strategic enterprise services -- such as security and IT solutions, as well as strategic networking -- increased 7.5 percent compared with fourth-quarter 2009 and now represent approximately 44 percent of global enterprise revenues.

Segment EBITDA margin (non-GAAP) was 23.5 percent, compared with 22.7 percent in third-quarter 2010 and 22.5 percent in fourth-quarter of 2009, as adjusted.

At Verizon Wireless, monthly cash expense per customer (non-GAAP) decreased in the fourth quarter 2010 to $26.59 from $27.72 in the fourth quarter 2009. For the full year, cash expense per customer was $26.80, down 2.7 percent from $27.55 in 2009.

In the fourth quarter, total data revenues were 37.1 percent of all service revenues, up from 31.8 percent in the fourth quarter 2009.

Verizon Wireless continued to invest in its 3G (third-generation) broadband network, the nation’s largest and most reliable 3G network. Verizon’s 3G network provides more coverage than any other U.S. carrier and is available where more than 290 million people reside.

In December, Verizon Wireless launched its 4G LTE (fourth-generation Long Term Evolution) Mobile Broadband network, the fastest and most advanced 4G network in the U.S., in 38 major metropolitan areas covering one-third of all Americans and in more than 60 commercial airports. With Verizon Wireless’ 4G LTE network, laptop users experience average data throughput speeds of up to 10 times faster than when on the company’s 3G network. Verizon Wireless announced earlier this month that it would expand its 4G LTE network to an additional 140 markets by the end of 2011.

Concurrent with the launch of its 4G LTE Mobile Broadband network, Verizon Wireless introduced two 4G LTE USB modems: the LG VL600 and the Pantech UML290, which are also compatible with the company’s 3G network. Verizon Wireless unveiled 10 new 4G

LTE consumer devices at the International Consumer Electronics Show earlier this month, including smartphones, tablets, mobile hot spot devices and notebooks that will be available in the first half of this year.

On Jan. 11, Verizon Wireless announced the iPhone4 will be available to customers beginning in February.

During the fourth quarter, Verizon Wireless customers sent or received more than 180 billion text messages. Customers also sent nearly 4.5 billion picture/video messages and completed more than 20 million music and video downloads from Verizon Wireless.

Fourth-quarter 2010 operating revenues were $10.3 billion, a decline of 2.8 percent compared with fourth-quarter 2009. Fourth-quarter 2010 cash operating expenses (non-GAAP) were $7.9 billion, a decline of 3.9 percent compared with fourth-quarter 2009.

Broadband connections totaled 8.4 million at the end of the fourth quarter 2010, a 2.8 percent year-over-year increase. This is a net increase of 52,000 from the third quarter 2010, as the increase in FiOS Internet connections more than offset a decrease in HSI connections.

As of year-end 2010, the FiOS network passed 15.6 million premises, or approximately 60 percent of Verizon’s domestic wireline footprint following the close of the Frontier transaction on July 1, 2010.

The wireline workforce totaled 92,300 at year-end 2010, a decline of about 16,000 year over year, primarily as a result of incentive offers that have led to voluntary separations.

During the quarter, Verizon continued to deploy secure global IT and communications solutions that enable better business outcomes for multinational enterprise, medium-sized and government customers wherever and whenever they operate. These solutions included additional capabilities that support the company’s “everything-as-a-service” cloud strategy, as well as a platform for developing enterprise mobility applications and new unified communications professional services. Additionally, top industry analysts recognized Verizon leadership in a number of key areas, including for managed security services in the North America, Europe and Asia-Pacific regions.

Verizon expanded its global network infrastructure during the quarter as it continued to broaden its global scope and capabilities. The company installed 16 additional Private IP edge routers for a total of 814 edge routers in 233 sites throughout 61 countries; implemented the first production deployment of a true 100G (gigabit-per-second) transmission system on the Verizon backbone network; launched its packet optical transport platform initiative for Private IP and Ethernet services in the Asia-Pacific, Europe and Latin America regions; and installed 22 new nodes in the Switched Ethernet Service network in support of a fiber-to-the-cell-site initiative in the U.S.

Multinational corporations, including Carlsberg and National Grid, completed new agreements, expanding their relationships with Verizon for a wide range of advanced communications and IT solutions. Verizon also continued to win new government business, including an award from the U.S. General Services Administration to provide secure on-demand cloud computing service.

Unaudited

Operating Revenues

Operating Expenses

Cost of services and sales

Selling, general & administrative expense

Depreciation and amortization expense

Operating Income

Equity in earnings of unconsolidated businesses

Other income and (expense), net

Interest expense

Income Before Provision for Income Taxes

Provision for income taxes

Net Income

Net income attributable to noncontrolling interest

Net income attributable to Verizon

Net Income

Basic Earnings per Common Share

Net income attributable to Verizon

Weighted average number of common shares (in millions)

Diluted Earnings per Common Share ⁽¹⁾

Net income attributable to Verizon

Weighted average number of common
shares-assuming dilution (in millions)

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Assets

Current assets

Cash and cash equivalents

Short-term investments

Accounts receivable, net

Inventories

Prepaid expenses and other

Total current assets

Plant, property and equipment

Less accumulated depreciation

Investments in unconsolidated businesses

Wireless licenses

Goodwill

Other intangible assets, net

Other assets

Liabilities and Equity

Current liabilities

Debt maturing within one year

Accounts payable and accrued liabilities

Other

Total current liabilities

Long-term debt

Employee benefit obligations

Deferred income taxes

Other liabilities

Equity

Common stock

Contributed capital

Reinvested earnings

Accumulated other comprehensive income (loss)

Common stock in treasury, at cost

Deferred compensation - employee stock ownership plans and other

Noncontrolling interest

Total equity

Total Liabilities and Equity

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Cash Flows From Operating Activities

Net Income

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization expense

Employee retirement benefits

Deferred income taxes

Provision for uncollectible accounts

Equity in earnings of unconsolidated businesses, net of dividends received

Changes in current assets and liabilities, net of effects from acquisition/
disposition of businesses

Other, net

Net cash provided by operating activities

Cash Flows From Investing Activities

Capital expenditures (including capitalized software)

Acquisitions of licenses, investments and businesses, net of cash acquired

Proceeds from dispositions

Net change in short-term investments

Other, net

Net cash used in investing activities

Cash Flows From Financing Activities

Proceeds from long-term borrowings

Repayments of long-term borrowings and capital lease obligations

Decrease in short-term obligations, excluding current maturities

Dividends paid

Proceeds from access line spin-off

Other, net

Net cash used in financing activities

Increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

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Debt to debt and Verizon’s equity ratio, end of period ⁽¹⁾

Book value per common share ⁽¹⁾

Common shares outstanding (in millions) end of period

Total employees

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Capital expenditures (including capitalized software)

Domestic Wireless

Wireline

Other

Total

Cash dividends declared per common share

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Revenues

Service revenues

Equipment and other

Total Revenues

Operating Expenses

Cost of services and sales

Selling, general & administrative expense

Depreciation and amortization expense

Total Operating Expenses

Operating Income

Operating Income Margin

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Total Customers

Retail Customers

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Total Customer net adds in period ⁽¹⁾

Retail Customer net adds in period ⁽¹⁾

Total churn rate

Retail churn rate

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Operating Revenues

Mass Markets

Global Enterprise

Global Wholesale

Other

Total Operating Revenues

Operating Expenses

Cost of services and sales

Selling, general & administrative expense

Depreciation and amortization expense

Total Operating Expenses

Operating Income

Operating Income Margin

Unaudited

Switched access lines in service

Total Residence (includes Primary residence)

Primary residence

Business

Public

Total

Broadband connections

FiOS Internet Subscribers

FiOS TV Subscribers

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Free Cash Flow

Net cash provided by operating activities

Less: capital expenditures

Free Cash Flow

Unaudited

Consolidated Operating Revenues - Reported

Less: Impact of divested operations

Consolidated Adjusted Operating Revenues

Y/Y $ Change

Y/Y % Change

Unaudited

Verizon Wireless Segment EBITDA

Operating income

Add: depreciation and amortization expense

Verizon Wireless Segment EBITDA

Verizon Wireless total revenues

Verizon Wireless service revenues

Verizon Wireless operating income margin

Verizon Wireless Segment EBITDA service margin