Verizon Communications Posts Strong First Quarter Earnings

Adjusted EPS of 72 Cents at High End of Target Range;

Sustained Demand for Data, Long-Distance, Wireless Services



FIRST QUARTER HIGHLIGHTS



* 180,000 new DSL (digital subscriber line) customers for total of

720,000

* 500,000 new long-distance customers, 5.2 million nationwide

* $2 billion-plus Massachusetts long-distance market opened

* $1 billion reduction in 2001 capital program

* 27 million U.S. wireless customers, with largest digital customer

base in U.S.

* 28 percent data revenue growth over first quarter 2000

* 59 percent growth in data circuits as measured in access line

equivalents (ALEs); total ALEs in service grow 20 percent to

112 million

* 41 percent growth in proportionate international wireless customers

to 8.3 million

* Global Solutions begins operating high-speed international network



Apr 24, 2001, 01:00 ET from Verizon Communications Inc.

    NEW YORK, April 24 /PRNewswire Interactive News Release/ -- Verizon
 Communications Inc. (NYSE:   VZ) today announced adjusted diluted earnings per
 share (EPS) for first quarter 2001 of 72 cents on net income of $2.0 billion,
 a 4.3 percent increase from 69 cents, or $1.9 billion, in first quarter 2000.
 The results were at the top of the company's target range for the quarter of
 70-72 cents.  Reported results are described below.
     Consolidated revenues for the quarter grew 16.9 percent, to $16.3 billion
 from $13.9 billion in first quarter 2000, with more than 40 percent, or
 approximately $6.6 billion, generated from high-growth data, wireless,
 long-distance, DSL and international services.  Verizon's U.S. Telecom
 business grew revenues to $10.9 billion, up 2.9 percent, while operating in
 the nation's most competitive markets.
     First quarter 2000 revenues do not include the properties of Vodafone
 Group Plc that became part of Verizon Wireless in April 2000.  In a pro forma
 comparison including those properties, revenues increased 7.0 percent from
 $15.2 billion.
     "Verizon delivered excellent results in a period of industry-wide
 transition and economic uncertainty," said Verizon Chairman and Co-CEO Charles
 R. Lee.
     "We saw healthy unit volumes, especially for our new services, and
 revenues grew at the levels we expected.  With improvements in DSL
 provisioning, the expansion of our long-distance offering to new states and
 the start-up of our global network, we made significant progress in developing
 the assets, building the customer bases and moving toward the revenue mix on
 which we will drive long-term growth.
     "We're off to a good start for the full year, and we continue to target
 full-year EPS in the $3.13-$3.17 range," Lee said.
     Verizon President and Co-CEO Ivan Seidenberg said, "Like all companies, we
 are closely monitoring the economy, but what we see at this time indicates we
 can hit our target for full-year revenue growth.  We continue to experience
 strong demand for DSL, data circuits and wireless services, and we will start
 selling long distance in Massachusetts this Thursday.
     "On the expense side, we continue to integrate operations, systems and
 processes and realize the synergies of the Bell Atlantic-GTE merger.  As the
 year-over-year decrease in our Telecom Group's cash expenses demonstrates,
 we've made a strong start this quarter toward our full-year target of
 $800 million in merger-related expense savings.
     "Regarding capital, current market conditions for communications equipment
 are favorable, and we have decided to scale back our capital program by
 $1 billion to approximately $17.5 billion.  We can hold expenditures at last
 year's levels and still make the investments necessary to maintain quality and
 build the businesses of the future."
     Consolidated adjusted expenses also exclude the Vodafone properties in
 first quarter 2000 and show a 17.5 percent increase over first quarter 2000.
 However, with the Vodafone properties in both periods, expenses increased 4.7
 percent.  Merger-related expense savings and cost-control measures enabled the
 company to hold increases in cash expenses on a comparable basis to 2.6
 percent at the same time the company continued to invest in high-growth
 capabilities and services.  Verizon's largest business unit, U.S. Telecom,
 decreased its cash expenses over first quarter 2000 by one percent, and its
 total adjusted expenses increased only 1.6 percent.  Excluding costs
 associated with the DSL and long-distance businesses, Telecom's quarterly
 expenses would have decreased 0.4 percent, with cash expenses declining 3.6
 percent.
 
                            Highlights of Operations
 
      DSL:
 
     *     Verizon added DSL lines in the first quarter at the same rate as in
           fourth quarter 2000, ending the quarter with 180,000 new lines for a
           total of approximately 720,000 lines in service, nearly five times
           the number at the end of first quarter 2000.
 
     *     Verizon brought the number of its DSL-equipped central offices to
           1,950, increasing the number of lines qualified for the service at
           the end of the quarter to nearly 30 million, or 47 percent of the
           company's access lines.  Approximately 42 percent of the households
           served by Verizon have access to DSL.
 
     *     Verizon Online, the company's Internet service provider, ended the
           quarter with approximately 950,000 subscribers, a 33 percent
           increase over first quarter 2000.
 
 
      Data:
 
     *     Revenues from data services, including high-capacity, high-speed
           local transport services, continued their strong growth, increasing
           27.6 percent to $1.7 billion from $1.3 billion in first quarter
           2000.
 
     *     Verizon ended the quarter with data circuits in service equivalent
           to 49.1 million voice-grade access lines, up 58.7 percent from first
           quarter 2000.  These data circuits combined with 62.9 million
           voice-grade access lines to give Verizon 112 million total access
           line equivalents in service at the end of the quarter, 19.8 percent
           more than at the end of first quarter 2000.
 
 
      Long-Distance/Bundled Services:
 
     *     Verizon Long Distance added approximately 500,000 new customers and
           ended the quarter as the nation's fourth largest long-distance
           provider with 5.2 million customers nationwide.  These results
           exclude customers of Verizon Select Services, which is in the
           process of discontinuing its local and long-distance offerings.
 
     *     In February, the company introduced its simple, surprise-free
           long-distance plans in 36 states and attracted more than 200,000
           customers.  The company's success in New York also continued, and it
           ended the quarter with 1.7 million customers in the state using its
           long-distance services over 1.9 million lines.
 
     *     More than 120,000 of the New York customers added in the quarter
           came back to Verizon from other carriers for their intraLATA toll
           calling, increasing the total number of "win-back" customers in New
           York to nearly 447,000, 37 percent more than at the end of fourth
           quarter 2000.
 
     *     The number of customers combining vertical services such as Caller
           ID and Home Voice Mail, often with basic telephone service, grew 66
           percent over first quarter 2000.  Revenues from service packages
           grew 86 percent and totaled nearly $260 million.
 
     *     On April 16, Verizon received Federal Communications Commission
           approval to offer long-distance service in Massachusetts, where
           Verizon serves 4.7 million access lines and the long-distance market
           is a $2 billion-plus annual opportunity.  Verizon Long Distance will
           launch service this week.  The company filed for FCC approval
           yesterday for Connecticut and plans to file for Pennsylvania this
           summer and up to five more states by the end of the year.
 
 
      Verizon Wireless:
 
           Verizon Wireless comparisons assume that the joint venture existed
           on Jan. 1, 2000.
 
     *     Verizon Wireless ended the first quarter with strong growth and
           financial performance, despite a one-time adjustment to its customer
           base.  Gross customer additions increased 8 percent over first
           quarter 2000, and penetration of covered POPs increased to 13.3
           percent.
 
     *     Following its April 5th announcement of subscriber results, Verizon
           Wireless moved aggressively to complete the assessment of its
           customer base as it consolidates billing platforms and standardizes
           policies as part of the merger integration process.  The recently
           completed assessment resulted in the removal of approximately
           900,000 additional non-revenue-generating accounts.  Total customers
           are now 27.1 million at the end of the quarter compared to the
           28 million announced April 5.
 
     *     As previously announced, net customer additions were 518,000 in the
           quarter, of which virtually all were digital contract customers.
           Net adds in the quarter were impacted by billing system
           reconciliations and would have been approximately 800,000 after
           adjusting for these and other issues.
 
     *     As part of its focus on the quality of its customer base, Verizon
           Wireless accelerated its digital migration and ended the quarter
           with approximately 16.3 million digital customers -- more than any
           other U.S. wireless carrier.  These customers generated 85 percent
           of the company's busy-hour usage.  Since first quarter 2000, the
           number of digital customers has grown approximately 65 percent.
 
     *     The company's financial performance also was strong, with continued
           accretion in service revenue per subscriber, cash flow and margins,
           and industry-leading profitability.  Service revenues for the
           quarter increased 19 percent to $3.7 billion, with service revenue
           per subscriber almost 3 percent higher.  This was the third
           consecutive quarter of year-over-year increase in service revenue
           per subscriber.  Total revenues were $4.0 billion, up 17.3 percent.
           Quarterly operating income rose 40.4 percent to $490 million, with
           operating cash flow increasing 20.3 percent to $1.4 billion.
           Operating cash flow margin was 37.8 percent for the quarter, up from
           37.4 percent.
 
     *     Churn for contract customers decreased from fourth quarter 2000 to
           2.3 percent, below the industry average.  Churn including prepaid
           customers increased to 2.8 percent from 2.7 percent in fourth
           quarter 2000.
 
     *     The number of Verizon Wireless data customers grew 33 percent from
           fourth quarter 2000 to more than one million.  During the quarter,
           the company expanded its data offerings to include the nation's
           first wireless service for the next-generation smart phone -- a
           Web-ready, Palm-powered handset incorporating a personal digital
           assistant (PDA).
 
 
      International:
 
     *     Revenues from consolidated international operations grew 15.3
           percent over first quarter 2000 to $527 million.  Worldwide demand
           for wireless services continued to be strong, with consolidated
           wireless revenue increasing 14.8 percent over last year.
 
     *     Equity income from international investments increased 26.2 percent
           to $217 million, with international operating cash flow growing 10.9
           percent to $143 million.
 
     *     The number of proportionate international wireless customers served
           by Verizon investments increased by 2.4 million to more than
           8.3 million, up 41.1 percent over first quarter 2000.  Proportionate
           operating cash flow grew 8.3 percent to $564 million.
 
     *     Verizon Global Solutions Inc. (GSI) began operating the first
           portions of its planned global network during the quarter.  GSI
           deployed a gateway in New York, a key location for the aggregation
           of international traffic.  GSI will turn on its second switch,
           located in Los Angeles to serve Latin American and Asian traffic, in
           the second quarter, and will also begin serving Europe from New York
           after FLAG Telecom's FLAG Atlantic-1 cable enters commercial
           service.
 
 
      Information Services:
 
     *     Revenues from Verizon's directory publishing and electronic commerce
           operations were $789 million in the first quarter, an increase of
           1.3 percent from first quarter 2000.  When adjusted to exclude
           affiliate transactions, revenue growth was 4.1 percent.  Revenues
           from SuperPages.com, Verizon's Internet directory service, doubled
           over first quarter 2000, as Information Services carried out its
           strategy to bundle print and online services.
 
     *     Operating income of $352 million grew 8.0 percent from first quarter
           2000 through merger synergies and aggressive cost containment as
           well as revenue growth.
 
 
                                Reported Results
 
     Reported first quarter 2001 earnings of 58 cents per share, or
 $1.6 billion, increased 5.5 percent from 55 cents, or $1.5 billion, in first
 quarter 2000.  Reported results reflect the net after-tax effect of gains,
 charges and other adjustments.
     Reported net income for first quarter 2001 reflects after-tax charges
 totaling $384 million, or 14 cents per share.  These include charges for
 transition costs related to the Bell Atlantic-GTE merger of $88 million, or
 3 cents per share, and charges resulting from a new accounting principle
 (FAS 133) that went into effect Jan. 1, 2001, requiring that certain financial
 instruments be marked to market each quarter and non-cash gains or losses be
 recorded.  Reported results for first quarter 2001 include a mark-to-market
 adjustment for the quarter of $114 million, or 4 cents per share, and a
 separate adjustment for the cumulative effect of the new principle as of
 January 1, 2001 of $182 million, or 7 cents per share.  Both adjustments
 relate primarily to the company's convertible debt investment in Metromedia
 Fiber Network Inc.
     Reported net income for first quarter 2000 of $1.5 billion, or 55 cents
 per share, reflects net after-tax effect of charges, partially offset by
 adjustments for net gains on asset sales and pension settlement gains,
 totaling $397 million, or 14 cents per share.  Charges include net losses of
 Genuity (which was separated from Verizon by FCC order in 2000 through an
 initial public offering), the cumulative effect of accounting adjustments for
 revenue recognition, and mark-to-market adjustments for notes that are
 exchangeable into shares of NTL Inc. and Cable & Wireless Plc.  This
 adjustment is a non-cash gain or loss, subject to limitations, depending on
 the share prices of NTL and Cable & Wireless.
 
     EDITOR'S NOTE:  Verizon will hold a conference call on first quarter
 results this afternoon at 4:30 p.m. EDT.  The call will be Webcast at
 http://www.verizon.com/investor.  Materials related to the call will also be
 available there.
 
     Verizon Communications (NYSE:   VZ) is one of the world's leading providers
 of communications services.  Verizon companies are the largest providers of
 wireline and wireless communications in the United States, with 112 million
 access line equivalents and 27 million wireless customers.  Verizon is also
 the largest directory publisher in the world.  A Fortune 10 company with
 approximately $65 billion in annual revenues and more than 260,000 employees,
 Verizon's global presence extends to more than 40 countries in the Americas,
 Europe, Asia and the Pacific.  For more information on Verizon, visit
 http://www.verizon.com.
 
     NOTE:  This press release contains statements about expected future events
 and financial results that are forward-looking and subject to risks and
 uncertainties.  For those statements, we claim the protection of the safe
 harbor for forward-looking statements contained in the Private Securities
 Litigation Reform Act of 1995.  The following important factors could affect
 future results and could cause those results to differ materially from those
 expressed in the forward-looking statements:  materially adverse changes in
 economic conditions in the markets served by us or by companies in which we
 have substantial investments; material changes in available technology; an
 adverse change in the ratings afforded our debt securities by nationally
 accredited ratings organizations; the final outcome of federal, state, and
 local regulatory initiatives and proceedings, including arbitration
 proceedings, and judicial review of those initiatives and proceedings,
 pertaining to, among other matters, the terms of interconnection, access
 charges, universal service, and unbundled network element and resale rates;
 the extent, timing, success, and overall effects of competition from others in
 the local telephone and intraLATA toll service markets; the timing and
 profitability of our entry into the in-region long-distance market; our
 ability to combine former Bell Atlantic and GTE operations, satisfy regulatory
 conditions and obtain revenue enhancements and cost savings; the profitability
 of our entry into the broadband access market; the ability of Verizon Wireless
 to combine operations and obtain revenue enhancements and cost savings; our
 ability to convert our ownership interest in Genuity Inc. into a controlling
 interest consistent with regulatory conditions, and Genuity's ensuing
 profitability; and changes in our accounting assumptions that may be required
 by regulatory agencies, including the SEC, or that result from changes in the
 accounting rules or their application, which could result in an impact on
 earnings.
 
      Verizon Communications
      Consolidated Statements of Income - Reported Basis
 
                                (dollars in millions, except per share amounts)
 
                                           3 Mos. Ended  3 Mos. Ended
     Unaudited                               03/31/01      03/31/00   % Change
 
     Operating Revenues                        $16,266     $14,532       11.9
 
     Operations and support expense              9,299       8,210       13.3
     Depreciation and amortization expense       3,360       2,591       29.7
     Gains on sales of assets, net                  --         (97)    (100.0)
 
     Operating Income                            3,607       3,828       (5.8)
     Equity in income from unconsolidated
      businesses                                   216         230       (6.1)
     Other income and (expense), net                70          78      (10.3)
     Interest expense                             (921)       (774)      19.0
     Minority interest                             (98)        (26)         *
     Mark-to-market adjustment - financial
      instruments                                 (116)       (825)     (85.9)
     Provision for income taxes                 (1,004)       (947)       6.0
     Income from Continuing Operations           1,754       1,564       12.1
     Extraordinary item, net of tax                  -          (9)    (100.0)
     Cumulative effect of accounting change       (182)        (40)         *
     Net Income                                  1,572       1,515        3.8
        Redemption of subsidiary preferred
         stock                                      --          (8)    (100.0)
     Net Income Available to
        Common Shareowners                      $1,572      $1,507        4.3
 
     Diluted Earnings per Share (1)              $0.58       $0.55        5.5
     Weighted average number of common
        shares-assuming dilution
         (in millions)                           2,725       2,756
 
 
     Footnote:
     (1)  Diluted Earnings per Share include the dilutive effect of shares
          issuable under our stock-based compensation plans, which represent
          the only potential dilutive common shares.
 
     *  Not meaningful
 
 
      Verizon Communications
      Consolidated Statements of Income - Adjusted Basis
 
                                (dollars in millions, except per share amounts)
 
                                           3 Mos. Ended  3 Mos. Ended
     Unaudited                               03/31/01      03/31/00   % Change
 
     Operating Revenues (1),(2)
       Domestic Telecom                       $10,920      $10,616         2.9
       Domestic Wireless                        4,046        2,164        87.0
       International                              527          457        15.3
       Information Services                       789          779         1.3
       Other                                      (16)         (98)      (83.7)
     Total Operating Revenues                  16,266       13,918        16.9
 
     Operating Expenses (1),(2)
       Operations and support expense           9,135        8,106        12.7
       Depreciation and amortization
        expense                                 3,360        2,529        32.9
     Total Operating Expenses                  12,495       10,635        17.5
 
     Operating Income (2)                       3,771        3,283        14.9
     Operating income impact of
      operations sold (1)                          --          209      (100.0)
     Equity in income from unconsolidated
      businesses                                  216          231        (6.5)
     Other income and (expense), net               70           86       (18.6)
     Interest expense                            (921)        (780)       18.1
     Minority interest                           (122)         (26)          *
     Provision for income taxes                (1,058)      (1,099)       (3.7)
     Adjusted Net Income                       $1,956       $1,904         2.7
 
     Diluted Adjusted Earnings per Share        $0.72        $0.69         4.3
     Weighted average number of common
       shares-assuming dilution
        (in millions)                           2,725        2,756
 
 
     Footnotes:
     (1)  Certain reclassifications of prior period amounts have been made,
          where appropriate, to reflect comparable results excluding
          significant operations sold, primarily previously announced Domestic
          Telecom access lines, as follows:
 
            Revenues                               $--         $360
            Expenses                               $--         $151
 
     (2)  The Verizon Wireless joint venture was formed in April 2000 with the
          acquisition of Vodafone's domestic wireless investments.  If the
          joint venture was formed on January 1, 2000, certain comparative
          financial information would be as follows:
 
     Operating Revenues
       Domestic Telecom                       $10,920      $10,616         2.9
       Domestic Wireless                        4,046        3,450        17.3
       International                              527          457        15.3
       Information Services                       789          779         1.3
       Other                                      (16)         (98)      (83.7)
     Total Operating Revenues                  16,266       15,204         7.0
 
     Operating Expenses
       Operations and support expense           9,135        8,901         2.6
       Depreciation and amortization
        expense                                 3,360        3,029        10.9
     Total Operating Expenses                  12,495       11,930         4.7
 
     Operating Income                          $3,771       $3,274        15.2
 
 
     *  Not meaningful
 
 
      Verizon Communications
      Earnings Reconciliations
 
                                (dollars in millions, except per share amounts)
 
                                            3 Mos. Ended       3 Mos. Ended
                                              3/31/01            3/31/00
     Unaudited                             Net     Diluted    Net     Diluted
                                         Income      EPS    Income       EPS
 
     Reported Earnings                     $1,572   $.58    $1,507      $.55
     Adjustments:
       Mark-to-market adjustment -
        financial instruments
         CWC exchangeable notes                --     --       536       .19
         Other financial instruments          114    .04        --       --
       Gains on sales of assets, net           --     --       (55)     (.02)
       Transition costs                        88    .03        --       --
       Settlements (conforming)                --     --      (304)     (.11)
       Cumulative effect of accounting
        change                                182    .07        40       .01
       Special items                           --     --        35       .01
       Genuity loss                            --     --       128       .05
       Extraordinary item                      --     --         9       --
       Redemption of subsidiary preferred
        stock                                  --     --         8       --
 
     Adjusted Earnings (1)                 $1,956   $.72    $1,904      $.69
 
 
     Footnote:
     (1)  Totals for Diluted EPS do not add for all periods due to rounding in
          EPS calculations.
 
 
     Verizon Communications
     Selected Financial and Operating Statistics
 
                               (dollars in millions, except per share amounts)
 
                                                          3 Mos.      3 Mos.
                                                           Ended       Ended
     Unaudited                                           03/31/01    03/31/00
 
     Debt ratio-end of period                                64.1%     65.1%
 
     Book value per common share                            $12.83     $9.94
 
     Cash dividends declared per common share (1)           $0.385    $0.385
 
     Common shares outstanding (in millions)
       End of period                                         2,704     2,718
 
     Capital expenditures
       Domestic Telecom                                     $3,339    $2,464
       Domestic Wireless (2)                                   988       473
       International                                           111        41
       Information Services                                      9        10
       Other (3)                                                31       161
       Total                                                $4,478    $3,149
 
     Total employees                                       261,153   259,102
 
     Footnotes:
     (1)  Represents dividends declared by Bell Atlantic.
     (2)  Bell Atlantic Mobile and GTE Wireless only prior to April 2000.
     (3)  Includes amounts from Genuity (formerly GTE Internetworking) prior
          to July 2000.
 
 
     Verizon Communications
     Consolidated Balance Sheets
 
                                                        (dollars in millions)
 
     Unaudited                                 3/31/01    12/31/00  $ Change
 
     Assets
       Current assets
         Cash and cash equivalents               $689        $757      $(68)
         Short-term investments                 1,010       1,613      (603)
         Accounts receivable, net              13,988      14,010       (22)
         Inventories                            2,049       1,910       139
         Net assets held for sale                 567         518        49
         Prepaid expenses and other             3,674       3,313       361
       Total current assets                    21,977      22,121      (144)
       Plant, property and equipment          162,892     158,957     3,935
         Less accumulated depreciation         91,523      89,453     2,070
                                               71,369      69,504     1,865
       Investments in unconsolidated
        businesses                             12,369      13,115      (746)
       Intangible assets                       44,083      41,990     2,093
       Other assets                            18,000      18,005        (5)
     Total Assets                            $167,798    $164,735    $3,063
 
 
     Liabilities and Shareowners' Investment
       Current liabilities
         Debt maturing within one year        $17,429     $14,838    $2,591
         Accounts payable and accrued
          liabilities                          12,610      13,965    (1,355)
         Other                                  5,376       5,433       (57)
       Total current liabilities               35,415      34,236     1,179
       Long-term debt                          44,394      42,491     1,903
       Employee benefit obligations            12,470      12,543       (73)
       Deferred income taxes                   15,559      15,260       299
       Other liabilities                        3,561       3,797      (236)
 
       Minority interest, including a portion
        subject to redemption requirements     21,701      21,830      (129)
 
       Shareowners' investment
         Common stock                             275         275       --
         Contributed capital                   24,545      24,555       (10)
         Reinvested earnings                   15,200      14,667       533
         Accumulated other comprehensive
          loss                                 (2,737)     (2,176)     (561)
                                               37,283      37,321       (38)
 
         Less common stock in treasury, at
          cost                                  1,753       1,861      (108)
         Less deferred compensation -
           employee stock ownership plans
            and other                             832         882       (50)
       Total shareowners' investment           34,698      34,578       120
     Total Liabilities and Shareowners'
      Investment                             $167,798    $164,735    $3,063
 
 
     Verizon Communications
     Condensed Consolidated Statements of Cash Flows
 
                                                          (dollars in millions)
 
                                          3 Mos. Ended  3 Mos. Ended
     Unaudited                                03/31/01    03/31/00    $ Change
 
     Cash Flows From Operating Activities
     Income before extraordinary item and
      cumulative effect of accounting change   $1,754      $1,564        $190
     Adjustments to reconcile income before
      extraordinary item and cumulative effect
       of accounting change to net cash
       provided by operating activities:
         Depreciation and amortization          3,360       2,591         769
         Gains on sales of assets, net             --         (97)         97
         Mark-to-market adjustment -
          financial instruments                   116         825        (709)
         Employee retirement benefits            (476)     (1,033)        557
         Deferred income taxes                    416         211         205
         Provision for uncollectible accounts     364         262         102
         Equity in income from
          unconsolidated businesses              (216)       (230)         14
         Changes in current assets and
          liabilities, net of effects from
          acquisition/disposition of
          businesses                           (2,170)        182      (2,352)
         Other, net                               (46)        199        (245)
     Net cash provided by operating
      activities                                3,102       4,474      (1,372)
 
     Cash Flows From Investing Activities
     Capital expenditures                      (4,478)     (3,149)     (1,329)
     Acquisitions, net of cash acquired,
      and investments                          (2,099)     (2,022)        (77)
     Proceeds from disposition of
      businesses and assets                        --          47         (47)
     Net change in short-term investments         577         208         369
     Other, net                                  (454)       (151)       (303)
     Net cash used in investing activities     (6,454)     (5,067)     (1,387)
 
     Cash Flows From Financing Activities
     Proceeds from long-term borrowings         2,941       1,362       1,579
     Repayments of long-term borrowings
      and capital lease obligations              (798)     (1,064)        266
     Increase in short-term obligations,
       excluding current maturities             2,205       1,098       1,107
     Dividends paid                            (1,040)     (1,053)         13
     Proceeds from sale of common stock            77         159         (82)
     Purchase of common stock for treasury         (6)     (1,083)      1,077
     Other, net                                   (95)       (155)         60
     Net cash provided by (used in)
      financing activities                      3,284        (736)      4,020
     Decrease in cash and cash equivalents        (68)     (1,329)      1,261
     Cash and cash equivalents, beginning
      of period                                   757       2,033      (1,276)
     Cash and cash equivalents, end of
      period                                     $689        $704        $(15)
 
 
      Verizon Communications
      Domestic Telecom - Selected Financial Results
 
                                                      (dollars in millions)
 
                                            3 Mos. Ended  3 Mos. Ended
     Unaudited                                03/31/01      03/31/00  % Change
 
     Operating Revenues
        Local services                          $5,620       $5,430        3.5
        Network access services                  3,292        3,230        1.9
        Long distance services                     762          804       (5.2)
        Other services                           1,246        1,152        8.2
     Total Operating Revenues                   10,920       10,616        2.9
 
     Operating Expenses
        Operations and support                   5,957        6,015       (1.0)
        Depreciation and amortization            2,283        2,097        8.9
     Total Operating Expenses                    8,240        8,112        1.6
 
     Operating Income                           $2,680       $2,504        7.0
     Operating Income Margin                     24.5%        23.6%
 
     Operating Cash Flow                        $4,963       $4,601        7.9
     Operating Cash Flow Margin                  45.4%        43.3%
 
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis and
     exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
 
 
      Verizon Communications
      Domestic Telecom - Selected Operating Statistics
 
                                           3 Mos. Ended  3 Mos. Ended
     Unaudited                               03/31/01      03/31/00   % Change
 
     Switched access lines in service (000)
        Residence                               40,026      39,956       0.2
        Business                                22,230      21,854       1.7
        Public                                     647         691      (6.4)
     Total                                      62,903      62,501       0.6
        DS0 equivalents                         49,061      30,921      58.7
     Total voice grade equivalents (000)       111,964      93,422      19.8
 
     BRI ISDN lines (000)                        1,403       1,255      11.8
     PRI ISDN                                    2,072       1,503      37.9
     Resale & UNE-P lines (000)                  3,627       2,311      56.9
     Minutes of use from Carriers and
      CLECs (in millions)                       72,565      71,764       1.1
     Long distance subscribers
      (excl. Verizon CLEC) (000s)                5,194       3,585      44.9
 
     High capacity and digital data
      revenues ($ in millions)
     Data transport                             $1,522      $1,168      30.3
     Data solutions                                179         165       8.5
     Total revenues                             $1,701      $1,333      27.6
 
 
     Footnote:
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
 
 
      Verizon Communications
      Verizon Wireless - Selected Operating Results
 
                                                    (dollars in millions)
 
                                            3 Mos. Ended 3 Mos. Ended
     Unaudited                                03/31/01     03/31/00   % Change
 
     Revenues
        Service revenues                        $3,731      $1,964       90.0
        Equipment and other                        315         200       57.5
     Total Revenues                              4,046       2,164       87.0
 
     Operating Expenses
        Operations and support                   2,637       1,484       77.7
        Depreciation and amortization              919         322      185.4
     Total Operating Expenses                    3,556       1,806       96.9
 
     Operating Income                             $490        $358       36.9
 
     Operating Cash Flow                        $1,409        $680      107.2
     Operating Cash Flow Margin                  37.8%       34.6%
 
 
     Selected Operating Statistics
     Subscribers (000)                          27,122      24,634       10.1
     Penetration                                 13.3%       12.1%
     Subscriber net adds in period (000)           518         874      (40.7)
     Total churn rate, including prepaid          2.8%        2.4%
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis
     and exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
     The Domestic Wireless financial information presented above for first
     quarter 2001 reflects the operations acquired from Vodafone (AirTouch) in
     connection with the formation of the Verizon Wireless joint venture
     effective April 2000.  The first quarter 2000 financial information
     presented above represents the combination of Bell Atlantic Mobile and GTE
     Wireless only.  The quarterly operating statistics shown above for both
     periods represent the Verizon Wireless joint venture.  Amortization of
     intangible assets resulting from the formation of the Verizon Wireless
     joint venture was $370 million for the first three months of 2001.
     Comparable 2000 amortization, not included in the table above, was
     $363 million.
     Prior period operating statistics do not reflect the potential impact
     from the 1.2 million subscriber base adjustment made in the first quarter
     2001 that is allocable to prior periods.
     The information below represents comparative results for the Verizon
     Wireless joint venture, on a combined basis, had the joint venture been
     formed on January 1, 2000:
 
 
                                                                        %
     Unaudited                                   1Q01        1Q00      Change
     Revenues
        Service revenues                        $3,731      $3,135      19.0
        Equipment and other                        315         315       --
     Total Revenues                              4,046       3,450      17.3
 
     Operating Expenses
        Operations and support                   2,637       2,279      15.7
        Depreciation and amortization              919         822      11.8
     Total Operating Expenses                    3,556       3,101      14.7
 
     Operating Income                             $490        $349      40.4
 
     Operating Cash Flow                        $1,409      $1,171      20.3
     Operating Cash Flow Margin                  37.8%       37.4%
 
 
      Verizon Communications
      International - Selected Financial Results
 
                                                     (dollars in millions)
 
                                            3 Mos. Ended  3 Mos. Ended
     Unaudited                                03/31/01      03/31/00  % Change
 
     Revenues
       Wireline and other                        $209        $180       16.1
       Wireless                                   318         277       14.8
     Total Revenues                               527         457       15.3
 
     Operating Expenses
       Operations and support                     384         328       17.1
       Depreciation and amortization              105          81       29.6
     Total Operating Expenses                     489         409       19.6
 
     Operating Income                             $38         $48      (20.8)
 
     Operating Cash Flow                         $143        $129       10.9
     Operating Cash Flow Margin                 27.1%       28.2%
 
     Equity in Income from Unconsolidated
      Businesses                                 $217        $172       26.2
 
 
     Proportionate Information
     Revenues                                  $1,396      $1,328        5.1
     Operating income                            $310        $305        1.6
     Operating cash flow                         $564        $521        8.3
 
     Access lines (000)                         3,219       3,327       (3.2)
     Wireless subscribers (000)                 8,333       5,907       41.1
 
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis
     and exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
 
 
      Verizon Communications
      Information Services - Selected Financial Results
 
                                                    (dollars in millions)
 
                                            3 Mos. Ended 3 Mos. Ended
     Unaudited                                03/31/01     03/31/00   % Change
 
     Operating Revenues                          $789        $779        1.3
 
     Operating Expenses
       Operations and support                     416         434       (4.1)
       Depreciation and amortization               21          19       10.5
     Total Operating Expenses                     437         453       (3.5)
 
     Operating Income                            $352        $326        8.0
 
     Operating Cash Flow                         $373        $345        8.1
     Operating Cash Flow Margin                 47.3%       44.3%
 
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis
     and exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
 
                     MAKE YOUR OPINION COUNT -- Click Here
                http://tbutton.prnewswire.com/prn/11690X79203223
 
 

SOURCE Verizon Communications Inc.
    NEW YORK, April 24 /PRNewswire Interactive News Release/ -- Verizon
 Communications Inc. (NYSE:   VZ) today announced adjusted diluted earnings per
 share (EPS) for first quarter 2001 of 72 cents on net income of $2.0 billion,
 a 4.3 percent increase from 69 cents, or $1.9 billion, in first quarter 2000.
 The results were at the top of the company's target range for the quarter of
 70-72 cents.  Reported results are described below.
     Consolidated revenues for the quarter grew 16.9 percent, to $16.3 billion
 from $13.9 billion in first quarter 2000, with more than 40 percent, or
 approximately $6.6 billion, generated from high-growth data, wireless,
 long-distance, DSL and international services.  Verizon's U.S. Telecom
 business grew revenues to $10.9 billion, up 2.9 percent, while operating in
 the nation's most competitive markets.
     First quarter 2000 revenues do not include the properties of Vodafone
 Group Plc that became part of Verizon Wireless in April 2000.  In a pro forma
 comparison including those properties, revenues increased 7.0 percent from
 $15.2 billion.
     "Verizon delivered excellent results in a period of industry-wide
 transition and economic uncertainty," said Verizon Chairman and Co-CEO Charles
 R. Lee.
     "We saw healthy unit volumes, especially for our new services, and
 revenues grew at the levels we expected.  With improvements in DSL
 provisioning, the expansion of our long-distance offering to new states and
 the start-up of our global network, we made significant progress in developing
 the assets, building the customer bases and moving toward the revenue mix on
 which we will drive long-term growth.
     "We're off to a good start for the full year, and we continue to target
 full-year EPS in the $3.13-$3.17 range," Lee said.
     Verizon President and Co-CEO Ivan Seidenberg said, "Like all companies, we
 are closely monitoring the economy, but what we see at this time indicates we
 can hit our target for full-year revenue growth.  We continue to experience
 strong demand for DSL, data circuits and wireless services, and we will start
 selling long distance in Massachusetts this Thursday.
     "On the expense side, we continue to integrate operations, systems and
 processes and realize the synergies of the Bell Atlantic-GTE merger.  As the
 year-over-year decrease in our Telecom Group's cash expenses demonstrates,
 we've made a strong start this quarter toward our full-year target of
 $800 million in merger-related expense savings.
     "Regarding capital, current market conditions for communications equipment
 are favorable, and we have decided to scale back our capital program by
 $1 billion to approximately $17.5 billion.  We can hold expenditures at last
 year's levels and still make the investments necessary to maintain quality and
 build the businesses of the future."
     Consolidated adjusted expenses also exclude the Vodafone properties in
 first quarter 2000 and show a 17.5 percent increase over first quarter 2000.
 However, with the Vodafone properties in both periods, expenses increased 4.7
 percent.  Merger-related expense savings and cost-control measures enabled the
 company to hold increases in cash expenses on a comparable basis to 2.6
 percent at the same time the company continued to invest in high-growth
 capabilities and services.  Verizon's largest business unit, U.S. Telecom,
 decreased its cash expenses over first quarter 2000 by one percent, and its
 total adjusted expenses increased only 1.6 percent.  Excluding costs
 associated with the DSL and long-distance businesses, Telecom's quarterly
 expenses would have decreased 0.4 percent, with cash expenses declining 3.6
 percent.
 
                            Highlights of Operations
 
      DSL:
 
     *     Verizon added DSL lines in the first quarter at the same rate as in
           fourth quarter 2000, ending the quarter with 180,000 new lines for a
           total of approximately 720,000 lines in service, nearly five times
           the number at the end of first quarter 2000.
 
     *     Verizon brought the number of its DSL-equipped central offices to
           1,950, increasing the number of lines qualified for the service at
           the end of the quarter to nearly 30 million, or 47 percent of the
           company's access lines.  Approximately 42 percent of the households
           served by Verizon have access to DSL.
 
     *     Verizon Online, the company's Internet service provider, ended the
           quarter with approximately 950,000 subscribers, a 33 percent
           increase over first quarter 2000.
 
 
      Data:
 
     *     Revenues from data services, including high-capacity, high-speed
           local transport services, continued their strong growth, increasing
           27.6 percent to $1.7 billion from $1.3 billion in first quarter
           2000.
 
     *     Verizon ended the quarter with data circuits in service equivalent
           to 49.1 million voice-grade access lines, up 58.7 percent from first
           quarter 2000.  These data circuits combined with 62.9 million
           voice-grade access lines to give Verizon 112 million total access
           line equivalents in service at the end of the quarter, 19.8 percent
           more than at the end of first quarter 2000.
 
 
      Long-Distance/Bundled Services:
 
     *     Verizon Long Distance added approximately 500,000 new customers and
           ended the quarter as the nation's fourth largest long-distance
           provider with 5.2 million customers nationwide.  These results
           exclude customers of Verizon Select Services, which is in the
           process of discontinuing its local and long-distance offerings.
 
     *     In February, the company introduced its simple, surprise-free
           long-distance plans in 36 states and attracted more than 200,000
           customers.  The company's success in New York also continued, and it
           ended the quarter with 1.7 million customers in the state using its
           long-distance services over 1.9 million lines.
 
     *     More than 120,000 of the New York customers added in the quarter
           came back to Verizon from other carriers for their intraLATA toll
           calling, increasing the total number of "win-back" customers in New
           York to nearly 447,000, 37 percent more than at the end of fourth
           quarter 2000.
 
     *     The number of customers combining vertical services such as Caller
           ID and Home Voice Mail, often with basic telephone service, grew 66
           percent over first quarter 2000.  Revenues from service packages
           grew 86 percent and totaled nearly $260 million.
 
     *     On April 16, Verizon received Federal Communications Commission
           approval to offer long-distance service in Massachusetts, where
           Verizon serves 4.7 million access lines and the long-distance market
           is a $2 billion-plus annual opportunity.  Verizon Long Distance will
           launch service this week.  The company filed for FCC approval
           yesterday for Connecticut and plans to file for Pennsylvania this
           summer and up to five more states by the end of the year.
 
 
      Verizon Wireless:
 
           Verizon Wireless comparisons assume that the joint venture existed
           on Jan. 1, 2000.
 
     *     Verizon Wireless ended the first quarter with strong growth and
           financial performance, despite a one-time adjustment to its customer
           base.  Gross customer additions increased 8 percent over first
           quarter 2000, and penetration of covered POPs increased to 13.3
           percent.
 
     *     Following its April 5th announcement of subscriber results, Verizon
           Wireless moved aggressively to complete the assessment of its
           customer base as it consolidates billing platforms and standardizes
           policies as part of the merger integration process.  The recently
           completed assessment resulted in the removal of approximately
           900,000 additional non-revenue-generating accounts.  Total customers
           are now 27.1 million at the end of the quarter compared to the
           28 million announced April 5.
 
     *     As previously announced, net customer additions were 518,000 in the
           quarter, of which virtually all were digital contract customers.
           Net adds in the quarter were impacted by billing system
           reconciliations and would have been approximately 800,000 after
           adjusting for these and other issues.
 
     *     As part of its focus on the quality of its customer base, Verizon
           Wireless accelerated its digital migration and ended the quarter
           with approximately 16.3 million digital customers -- more than any
           other U.S. wireless carrier.  These customers generated 85 percent
           of the company's busy-hour usage.  Since first quarter 2000, the
           number of digital customers has grown approximately 65 percent.
 
     *     The company's financial performance also was strong, with continued
           accretion in service revenue per subscriber, cash flow and margins,
           and industry-leading profitability.  Service revenues for the
           quarter increased 19 percent to $3.7 billion, with service revenue
           per subscriber almost 3 percent higher.  This was the third
           consecutive quarter of year-over-year increase in service revenue
           per subscriber.  Total revenues were $4.0 billion, up 17.3 percent.
           Quarterly operating income rose 40.4 percent to $490 million, with
           operating cash flow increasing 20.3 percent to $1.4 billion.
           Operating cash flow margin was 37.8 percent for the quarter, up from
           37.4 percent.
 
     *     Churn for contract customers decreased from fourth quarter 2000 to
           2.3 percent, below the industry average.  Churn including prepaid
           customers increased to 2.8 percent from 2.7 percent in fourth
           quarter 2000.
 
     *     The number of Verizon Wireless data customers grew 33 percent from
           fourth quarter 2000 to more than one million.  During the quarter,
           the company expanded its data offerings to include the nation's
           first wireless service for the next-generation smart phone -- a
           Web-ready, Palm-powered handset incorporating a personal digital
           assistant (PDA).
 
 
      International:
 
     *     Revenues from consolidated international operations grew 15.3
           percent over first quarter 2000 to $527 million.  Worldwide demand
           for wireless services continued to be strong, with consolidated
           wireless revenue increasing 14.8 percent over last year.
 
     *     Equity income from international investments increased 26.2 percent
           to $217 million, with international operating cash flow growing 10.9
           percent to $143 million.
 
     *     The number of proportionate international wireless customers served
           by Verizon investments increased by 2.4 million to more than
           8.3 million, up 41.1 percent over first quarter 2000.  Proportionate
           operating cash flow grew 8.3 percent to $564 million.
 
     *     Verizon Global Solutions Inc. (GSI) began operating the first
           portions of its planned global network during the quarter.  GSI
           deployed a gateway in New York, a key location for the aggregation
           of international traffic.  GSI will turn on its second switch,
           located in Los Angeles to serve Latin American and Asian traffic, in
           the second quarter, and will also begin serving Europe from New York
           after FLAG Telecom's FLAG Atlantic-1 cable enters commercial
           service.
 
 
      Information Services:
 
     *     Revenues from Verizon's directory publishing and electronic commerce
           operations were $789 million in the first quarter, an increase of
           1.3 percent from first quarter 2000.  When adjusted to exclude
           affiliate transactions, revenue growth was 4.1 percent.  Revenues
           from SuperPages.com, Verizon's Internet directory service, doubled
           over first quarter 2000, as Information Services carried out its
           strategy to bundle print and online services.
 
     *     Operating income of $352 million grew 8.0 percent from first quarter
           2000 through merger synergies and aggressive cost containment as
           well as revenue growth.
 
 
                                Reported Results
 
     Reported first quarter 2001 earnings of 58 cents per share, or
 $1.6 billion, increased 5.5 percent from 55 cents, or $1.5 billion, in first
 quarter 2000.  Reported results reflect the net after-tax effect of gains,
 charges and other adjustments.
     Reported net income for first quarter 2001 reflects after-tax charges
 totaling $384 million, or 14 cents per share.  These include charges for
 transition costs related to the Bell Atlantic-GTE merger of $88 million, or
 3 cents per share, and charges resulting from a new accounting principle
 (FAS 133) that went into effect Jan. 1, 2001, requiring that certain financial
 instruments be marked to market each quarter and non-cash gains or losses be
 recorded.  Reported results for first quarter 2001 include a mark-to-market
 adjustment for the quarter of $114 million, or 4 cents per share, and a
 separate adjustment for the cumulative effect of the new principle as of
 January 1, 2001 of $182 million, or 7 cents per share.  Both adjustments
 relate primarily to the company's convertible debt investment in Metromedia
 Fiber Network Inc.
     Reported net income for first quarter 2000 of $1.5 billion, or 55 cents
 per share, reflects net after-tax effect of charges, partially offset by
 adjustments for net gains on asset sales and pension settlement gains,
 totaling $397 million, or 14 cents per share.  Charges include net losses of
 Genuity (which was separated from Verizon by FCC order in 2000 through an
 initial public offering), the cumulative effect of accounting adjustments for
 revenue recognition, and mark-to-market adjustments for notes that are
 exchangeable into shares of NTL Inc. and Cable & Wireless Plc.  This
 adjustment is a non-cash gain or loss, subject to limitations, depending on
 the share prices of NTL and Cable & Wireless.
 
     EDITOR'S NOTE:  Verizon will hold a conference call on first quarter
 results this afternoon at 4:30 p.m. EDT.  The call will be Webcast at
 http://www.verizon.com/investor.  Materials related to the call will also be
 available there.
 
     Verizon Communications (NYSE:   VZ) is one of the world's leading providers
 of communications services.  Verizon companies are the largest providers of
 wireline and wireless communications in the United States, with 112 million
 access line equivalents and 27 million wireless customers.  Verizon is also
 the largest directory publisher in the world.  A Fortune 10 company with
 approximately $65 billion in annual revenues and more than 260,000 employees,
 Verizon's global presence extends to more than 40 countries in the Americas,
 Europe, Asia and the Pacific.  For more information on Verizon, visit
 http://www.verizon.com.
 
     NOTE:  This press release contains statements about expected future events
 and financial results that are forward-looking and subject to risks and
 uncertainties.  For those statements, we claim the protection of the safe
 harbor for forward-looking statements contained in the Private Securities
 Litigation Reform Act of 1995.  The following important factors could affect
 future results and could cause those results to differ materially from those
 expressed in the forward-looking statements:  materially adverse changes in
 economic conditions in the markets served by us or by companies in which we
 have substantial investments; material changes in available technology; an
 adverse change in the ratings afforded our debt securities by nationally
 accredited ratings organizations; the final outcome of federal, state, and
 local regulatory initiatives and proceedings, including arbitration
 proceedings, and judicial review of those initiatives and proceedings,
 pertaining to, among other matters, the terms of interconnection, access
 charges, universal service, and unbundled network element and resale rates;
 the extent, timing, success, and overall effects of competition from others in
 the local telephone and intraLATA toll service markets; the timing and
 profitability of our entry into the in-region long-distance market; our
 ability to combine former Bell Atlantic and GTE operations, satisfy regulatory
 conditions and obtain revenue enhancements and cost savings; the profitability
 of our entry into the broadband access market; the ability of Verizon Wireless
 to combine operations and obtain revenue enhancements and cost savings; our
 ability to convert our ownership interest in Genuity Inc. into a controlling
 interest consistent with regulatory conditions, and Genuity's ensuing
 profitability; and changes in our accounting assumptions that may be required
 by regulatory agencies, including the SEC, or that result from changes in the
 accounting rules or their application, which could result in an impact on
 earnings.
 
      Verizon Communications
      Consolidated Statements of Income - Reported Basis
 
                                (dollars in millions, except per share amounts)
 
                                           3 Mos. Ended  3 Mos. Ended
     Unaudited                               03/31/01      03/31/00   % Change
 
     Operating Revenues                        $16,266     $14,532       11.9
 
     Operations and support expense              9,299       8,210       13.3
     Depreciation and amortization expense       3,360       2,591       29.7
     Gains on sales of assets, net                  --         (97)    (100.0)
 
     Operating Income                            3,607       3,828       (5.8)
     Equity in income from unconsolidated
      businesses                                   216         230       (6.1)
     Other income and (expense), net                70          78      (10.3)
     Interest expense                             (921)       (774)      19.0
     Minority interest                             (98)        (26)         *
     Mark-to-market adjustment - financial
      instruments                                 (116)       (825)     (85.9)
     Provision for income taxes                 (1,004)       (947)       6.0
     Income from Continuing Operations           1,754       1,564       12.1
     Extraordinary item, net of tax                  -          (9)    (100.0)
     Cumulative effect of accounting change       (182)        (40)         *
     Net Income                                  1,572       1,515        3.8
        Redemption of subsidiary preferred
         stock                                      --          (8)    (100.0)
     Net Income Available to
        Common Shareowners                      $1,572      $1,507        4.3
 
     Diluted Earnings per Share (1)              $0.58       $0.55        5.5
     Weighted average number of common
        shares-assuming dilution
         (in millions)                           2,725       2,756
 
 
     Footnote:
     (1)  Diluted Earnings per Share include the dilutive effect of shares
          issuable under our stock-based compensation plans, which represent
          the only potential dilutive common shares.
 
     *  Not meaningful
 
 
      Verizon Communications
      Consolidated Statements of Income - Adjusted Basis
 
                                (dollars in millions, except per share amounts)
 
                                           3 Mos. Ended  3 Mos. Ended
     Unaudited                               03/31/01      03/31/00   % Change
 
     Operating Revenues (1),(2)
       Domestic Telecom                       $10,920      $10,616         2.9
       Domestic Wireless                        4,046        2,164        87.0
       International                              527          457        15.3
       Information Services                       789          779         1.3
       Other                                      (16)         (98)      (83.7)
     Total Operating Revenues                  16,266       13,918        16.9
 
     Operating Expenses (1),(2)
       Operations and support expense           9,135        8,106        12.7
       Depreciation and amortization
        expense                                 3,360        2,529        32.9
     Total Operating Expenses                  12,495       10,635        17.5
 
     Operating Income (2)                       3,771        3,283        14.9
     Operating income impact of
      operations sold (1)                          --          209      (100.0)
     Equity in income from unconsolidated
      businesses                                  216          231        (6.5)
     Other income and (expense), net               70           86       (18.6)
     Interest expense                            (921)        (780)       18.1
     Minority interest                           (122)         (26)          *
     Provision for income taxes                (1,058)      (1,099)       (3.7)
     Adjusted Net Income                       $1,956       $1,904         2.7
 
     Diluted Adjusted Earnings per Share        $0.72        $0.69         4.3
     Weighted average number of common
       shares-assuming dilution
        (in millions)                           2,725        2,756
 
 
     Footnotes:
     (1)  Certain reclassifications of prior period amounts have been made,
          where appropriate, to reflect comparable results excluding
          significant operations sold, primarily previously announced Domestic
          Telecom access lines, as follows:
 
            Revenues                               $--         $360
            Expenses                               $--         $151
 
     (2)  The Verizon Wireless joint venture was formed in April 2000 with the
          acquisition of Vodafone's domestic wireless investments.  If the
          joint venture was formed on January 1, 2000, certain comparative
          financial information would be as follows:
 
     Operating Revenues
       Domestic Telecom                       $10,920      $10,616         2.9
       Domestic Wireless                        4,046        3,450        17.3
       International                              527          457        15.3
       Information Services                       789          779         1.3
       Other                                      (16)         (98)      (83.7)
     Total Operating Revenues                  16,266       15,204         7.0
 
     Operating Expenses
       Operations and support expense           9,135        8,901         2.6
       Depreciation and amortization
        expense                                 3,360        3,029        10.9
     Total Operating Expenses                  12,495       11,930         4.7
 
     Operating Income                          $3,771       $3,274        15.2
 
 
     *  Not meaningful
 
 
      Verizon Communications
      Earnings Reconciliations
 
                                (dollars in millions, except per share amounts)
 
                                            3 Mos. Ended       3 Mos. Ended
                                              3/31/01            3/31/00
     Unaudited                             Net     Diluted    Net     Diluted
                                         Income      EPS    Income       EPS
 
     Reported Earnings                     $1,572   $.58    $1,507      $.55
     Adjustments:
       Mark-to-market adjustment -
        financial instruments
         CWC exchangeable notes                --     --       536       .19
         Other financial instruments          114    .04        --       --
       Gains on sales of assets, net           --     --       (55)     (.02)
       Transition costs                        88    .03        --       --
       Settlements (conforming)                --     --      (304)     (.11)
       Cumulative effect of accounting
        change                                182    .07        40       .01
       Special items                           --     --        35       .01
       Genuity loss                            --     --       128       .05
       Extraordinary item                      --     --         9       --
       Redemption of subsidiary preferred
        stock                                  --     --         8       --
 
     Adjusted Earnings (1)                 $1,956   $.72    $1,904      $.69
 
 
     Footnote:
     (1)  Totals for Diluted EPS do not add for all periods due to rounding in
          EPS calculations.
 
 
     Verizon Communications
     Selected Financial and Operating Statistics
 
                               (dollars in millions, except per share amounts)
 
                                                          3 Mos.      3 Mos.
                                                           Ended       Ended
     Unaudited                                           03/31/01    03/31/00
 
     Debt ratio-end of period                                64.1%     65.1%
 
     Book value per common share                            $12.83     $9.94
 
     Cash dividends declared per common share (1)           $0.385    $0.385
 
     Common shares outstanding (in millions)
       End of period                                         2,704     2,718
 
     Capital expenditures
       Domestic Telecom                                     $3,339    $2,464
       Domestic Wireless (2)                                   988       473
       International                                           111        41
       Information Services                                      9        10
       Other (3)                                                31       161
       Total                                                $4,478    $3,149
 
     Total employees                                       261,153   259,102
 
     Footnotes:
     (1)  Represents dividends declared by Bell Atlantic.
     (2)  Bell Atlantic Mobile and GTE Wireless only prior to April 2000.
     (3)  Includes amounts from Genuity (formerly GTE Internetworking) prior
          to July 2000.
 
 
     Verizon Communications
     Consolidated Balance Sheets
 
                                                        (dollars in millions)
 
     Unaudited                                 3/31/01    12/31/00  $ Change
 
     Assets
       Current assets
         Cash and cash equivalents               $689        $757      $(68)
         Short-term investments                 1,010       1,613      (603)
         Accounts receivable, net              13,988      14,010       (22)
         Inventories                            2,049       1,910       139
         Net assets held for sale                 567         518        49
         Prepaid expenses and other             3,674       3,313       361
       Total current assets                    21,977      22,121      (144)
       Plant, property and equipment          162,892     158,957     3,935
         Less accumulated depreciation         91,523      89,453     2,070
                                               71,369      69,504     1,865
       Investments in unconsolidated
        businesses                             12,369      13,115      (746)
       Intangible assets                       44,083      41,990     2,093
       Other assets                            18,000      18,005        (5)
     Total Assets                            $167,798    $164,735    $3,063
 
 
     Liabilities and Shareowners' Investment
       Current liabilities
         Debt maturing within one year        $17,429     $14,838    $2,591
         Accounts payable and accrued
          liabilities                          12,610      13,965    (1,355)
         Other                                  5,376       5,433       (57)
       Total current liabilities               35,415      34,236     1,179
       Long-term debt                          44,394      42,491     1,903
       Employee benefit obligations            12,470      12,543       (73)
       Deferred income taxes                   15,559      15,260       299
       Other liabilities                        3,561       3,797      (236)
 
       Minority interest, including a portion
        subject to redemption requirements     21,701      21,830      (129)
 
       Shareowners' investment
         Common stock                             275         275       --
         Contributed capital                   24,545      24,555       (10)
         Reinvested earnings                   15,200      14,667       533
         Accumulated other comprehensive
          loss                                 (2,737)     (2,176)     (561)
                                               37,283      37,321       (38)
 
         Less common stock in treasury, at
          cost                                  1,753       1,861      (108)
         Less deferred compensation -
           employee stock ownership plans
            and other                             832         882       (50)
       Total shareowners' investment           34,698      34,578       120
     Total Liabilities and Shareowners'
      Investment                             $167,798    $164,735    $3,063
 
 
     Verizon Communications
     Condensed Consolidated Statements of Cash Flows
 
                                                          (dollars in millions)
 
                                          3 Mos. Ended  3 Mos. Ended
     Unaudited                                03/31/01    03/31/00    $ Change
 
     Cash Flows From Operating Activities
     Income before extraordinary item and
      cumulative effect of accounting change   $1,754      $1,564        $190
     Adjustments to reconcile income before
      extraordinary item and cumulative effect
       of accounting change to net cash
       provided by operating activities:
         Depreciation and amortization          3,360       2,591         769
         Gains on sales of assets, net             --         (97)         97
         Mark-to-market adjustment -
          financial instruments                   116         825        (709)
         Employee retirement benefits            (476)     (1,033)        557
         Deferred income taxes                    416         211         205
         Provision for uncollectible accounts     364         262         102
         Equity in income from
          unconsolidated businesses              (216)       (230)         14
         Changes in current assets and
          liabilities, net of effects from
          acquisition/disposition of
          businesses                           (2,170)        182      (2,352)
         Other, net                               (46)        199        (245)
     Net cash provided by operating
      activities                                3,102       4,474      (1,372)
 
     Cash Flows From Investing Activities
     Capital expenditures                      (4,478)     (3,149)     (1,329)
     Acquisitions, net of cash acquired,
      and investments                          (2,099)     (2,022)        (77)
     Proceeds from disposition of
      businesses and assets                        --          47         (47)
     Net change in short-term investments         577         208         369
     Other, net                                  (454)       (151)       (303)
     Net cash used in investing activities     (6,454)     (5,067)     (1,387)
 
     Cash Flows From Financing Activities
     Proceeds from long-term borrowings         2,941       1,362       1,579
     Repayments of long-term borrowings
      and capital lease obligations              (798)     (1,064)        266
     Increase in short-term obligations,
       excluding current maturities             2,205       1,098       1,107
     Dividends paid                            (1,040)     (1,053)         13
     Proceeds from sale of common stock            77         159         (82)
     Purchase of common stock for treasury         (6)     (1,083)      1,077
     Other, net                                   (95)       (155)         60
     Net cash provided by (used in)
      financing activities                      3,284        (736)      4,020
     Decrease in cash and cash equivalents        (68)     (1,329)      1,261
     Cash and cash equivalents, beginning
      of period                                   757       2,033      (1,276)
     Cash and cash equivalents, end of
      period                                     $689        $704        $(15)
 
 
      Verizon Communications
      Domestic Telecom - Selected Financial Results
 
                                                      (dollars in millions)
 
                                            3 Mos. Ended  3 Mos. Ended
     Unaudited                                03/31/01      03/31/00  % Change
 
     Operating Revenues
        Local services                          $5,620       $5,430        3.5
        Network access services                  3,292        3,230        1.9
        Long distance services                     762          804       (5.2)
        Other services                           1,246        1,152        8.2
     Total Operating Revenues                   10,920       10,616        2.9
 
     Operating Expenses
        Operations and support                   5,957        6,015       (1.0)
        Depreciation and amortization            2,283        2,097        8.9
     Total Operating Expenses                    8,240        8,112        1.6
 
     Operating Income                           $2,680       $2,504        7.0
     Operating Income Margin                     24.5%        23.6%
 
     Operating Cash Flow                        $4,963       $4,601        7.9
     Operating Cash Flow Margin                  45.4%        43.3%
 
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis and
     exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
 
 
      Verizon Communications
      Domestic Telecom - Selected Operating Statistics
 
                                           3 Mos. Ended  3 Mos. Ended
     Unaudited                               03/31/01      03/31/00   % Change
 
     Switched access lines in service (000)
        Residence                               40,026      39,956       0.2
        Business                                22,230      21,854       1.7
        Public                                     647         691      (6.4)
     Total                                      62,903      62,501       0.6
        DS0 equivalents                         49,061      30,921      58.7
     Total voice grade equivalents (000)       111,964      93,422      19.8
 
     BRI ISDN lines (000)                        1,403       1,255      11.8
     PRI ISDN                                    2,072       1,503      37.9
     Resale & UNE-P lines (000)                  3,627       2,311      56.9
     Minutes of use from Carriers and
      CLECs (in millions)                       72,565      71,764       1.1
     Long distance subscribers
      (excl. Verizon CLEC) (000s)                5,194       3,585      44.9
 
     High capacity and digital data
      revenues ($ in millions)
     Data transport                             $1,522      $1,168      30.3
     Data solutions                                179         165       8.5
     Total revenues                             $1,701      $1,333      27.6
 
 
     Footnote:
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
 
 
      Verizon Communications
      Verizon Wireless - Selected Operating Results
 
                                                    (dollars in millions)
 
                                            3 Mos. Ended 3 Mos. Ended
     Unaudited                                03/31/01     03/31/00   % Change
 
     Revenues
        Service revenues                        $3,731      $1,964       90.0
        Equipment and other                        315         200       57.5
     Total Revenues                              4,046       2,164       87.0
 
     Operating Expenses
        Operations and support                   2,637       1,484       77.7
        Depreciation and amortization              919         322      185.4
     Total Operating Expenses                    3,556       1,806       96.9
 
     Operating Income                             $490        $358       36.9
 
     Operating Cash Flow                        $1,409        $680      107.2
     Operating Cash Flow Margin                  37.8%       34.6%
 
 
     Selected Operating Statistics
     Subscribers (000)                          27,122      24,634       10.1
     Penetration                                 13.3%       12.1%
     Subscriber net adds in period (000)           518         874      (40.7)
     Total churn rate, including prepaid          2.8%        2.4%
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis
     and exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
     The Domestic Wireless financial information presented above for first
     quarter 2001 reflects the operations acquired from Vodafone (AirTouch) in
     connection with the formation of the Verizon Wireless joint venture
     effective April 2000.  The first quarter 2000 financial information
     presented above represents the combination of Bell Atlantic Mobile and GTE
     Wireless only.  The quarterly operating statistics shown above for both
     periods represent the Verizon Wireless joint venture.  Amortization of
     intangible assets resulting from the formation of the Verizon Wireless
     joint venture was $370 million for the first three months of 2001.
     Comparable 2000 amortization, not included in the table above, was
     $363 million.
     Prior period operating statistics do not reflect the potential impact
     from the 1.2 million subscriber base adjustment made in the first quarter
     2001 that is allocable to prior periods.
     The information below represents comparative results for the Verizon
     Wireless joint venture, on a combined basis, had the joint venture been
     formed on January 1, 2000:
 
 
                                                                        %
     Unaudited                                   1Q01        1Q00      Change
     Revenues
        Service revenues                        $3,731      $3,135      19.0
        Equipment and other                        315         315       --
     Total Revenues                              4,046       3,450      17.3
 
     Operating Expenses
        Operations and support                   2,637       2,279      15.7
        Depreciation and amortization              919         822      11.8
     Total Operating Expenses                    3,556       3,101      14.7
 
     Operating Income                             $490        $349      40.4
 
     Operating Cash Flow                        $1,409      $1,171      20.3
     Operating Cash Flow Margin                  37.8%       37.4%
 
 
      Verizon Communications
      International - Selected Financial Results
 
                                                     (dollars in millions)
 
                                            3 Mos. Ended  3 Mos. Ended
     Unaudited                                03/31/01      03/31/00  % Change
 
     Revenues
       Wireline and other                        $209        $180       16.1
       Wireless                                   318         277       14.8
     Total Revenues                               527         457       15.3
 
     Operating Expenses
       Operations and support                     384         328       17.1
       Depreciation and amortization              105          81       29.6
     Total Operating Expenses                     489         409       19.6
 
     Operating Income                             $38         $48      (20.8)
 
     Operating Cash Flow                         $143        $129       10.9
     Operating Cash Flow Margin                 27.1%       28.2%
 
     Equity in Income from Unconsolidated
      Businesses                                 $217        $172       26.2
 
 
     Proportionate Information
     Revenues                                  $1,396      $1,328        5.1
     Operating income                            $310        $305        1.6
     Operating cash flow                         $564        $521        8.3
 
     Access lines (000)                         3,219       3,327       (3.2)
     Wireless subscribers (000)                 8,333       5,907       41.1
 
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis
     and exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
     Certain reclassifications of prior period amounts have been made, where
     appropriate, to reflect comparable operating results.
 
 
      Verizon Communications
      Information Services - Selected Financial Results
 
                                                    (dollars in millions)
 
                                            3 Mos. Ended 3 Mos. Ended
     Unaudited                                03/31/01     03/31/00   % Change
 
     Operating Revenues                          $789        $779        1.3
 
     Operating Expenses
       Operations and support                     416         434       (4.1)
       Depreciation and amortization               21          19       10.5
     Total Operating Expenses                     437         453       (3.5)
 
     Operating Income                            $352        $326        8.0
 
     Operating Cash Flow                         $373        $345        8.1
     Operating Cash Flow Margin                 47.3%       44.3%
 
 
     Footnotes:
     The segment financial results above are presented on an adjusted basis
     and exclude the effects of special items.
     Intercompany and intersegment transactions have not been eliminated.
 
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 SOURCE  Verizon Communications Inc.

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