New Delhi

Verizon, the US telecom giant, announced a huge hit to its fourth-quarter earnings, revealing a $5.8 billion write-down attributed to the devaluation of its declining wireline business.

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According to Reuters, this move comes as part of Verizon's strategic reassessment of its Business unit, a key segment catering to businesses and government clients.

 The wireline business, encompassing traditional voice and data services, has faced considerable challenges stemming from intense competition, economic uncertainties, and the ongoing industry-wide shift toward wireless services.

Verizon's decision to re-evaluate its Business unit underscores the persistent challenges in the wireline business, which has experienced a decline in revenue.

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The five-year review prompted a downward adjustment in the financial projections for this unit, which contributes to over a fifth of Verizon's overall revenue.

The competitive landscape, economic conditions, and the increasing popularity of wireless alternatives have collectively impacted the wireline segment.

As a result, Verizon has recalibrated the value of its Business unit.

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After the $5.8 billion write-down, the goodwill balance of the wireline unit stood at $1.7 billion as of December 31.

Verizon's shares responded to the announcement with a decline of over 1 per cent.

Verizon's upcoming fourth-quarter results, scheduled for release on January 23, will provide a detailed overview of the impact of this strategic move on its overall financial performance.

(With inputs from Reuters)