(Reuters) -Verizon’s fourth-quarter results will take a $5.8 billion hit from charges related to a write down in the value of its unit that caters to businesses and government clients due to declining wireline revenue, the U.S. telecom firm said.
The move follows a five-year review of the unit that showed its financial projections were now much lower than previous planning cycle, it disclosed in a regulatory filing on Wednesday.
The wireline business, which includes legacy voice and data services, has been under pressure due to strong competition, an uncertain economy and a broader shift to wireless services.
After the charge, the goodwill balance of the unit was $1.7 billion as of Dec. 31, Verizon said. Its shares were down nearly 1%.
In the third quarter, Verizon Business saw a 4% decline in revenue due to lower wireline and wireless equipment revenue. The unit accounts for more than a fifth of the company’s total revenue.
Verizon will report its fourth-quarter results on Jan. 23.
(Reporting by Samrhitha Arunasalam in Bengaluru; Editing by Savio D’Souza and Shilpi Majumdar)