When Verizon (VZ -6.08%) reported its earnings on Tuesday, it was impossible to miss the troubling signs. Revenue was basically flat year over year -- not a good look. But for MarketFoolery host Chris Hill and Bill Mann, the Fool's director of small-cap research, the more interesting takeaway was that the company was admitting outright that it blundered in a big way in its twin purchases of AOL and Yahoo!, to the tune of a $4.9 billion writedown on what it briefly called Oath and now refers to as the Verizon Media Group.

In this segment of the podcast, the Fools talk about the company's decent quarter, its plans for layoffs and cost-cutting measures, and the difficulties inherent in playing in the telecom sandbox.

A full transcript follows the video.

Check out the latest Verizon earnings call transcript.

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This video was recorded on Jan. 29, 2019.

Chris Hill: Let's start with Verizon, which closed out the fiscal year with a fourth quarter report, profits a little bit higher than expected. I think I have this right, their overall revenue was barely above where it was a year ago.

Bill Mann: Chris, you're not going to believe this, but it turns out that the Oath properties, which is AOL and Yahoo, are not worth what Verizon paid for them.

Hill: I'm shocked.

Mann: I've been told that they paid more than nothing for them. They have a $4.9 billion writedown. They're not really breaking it out. Oath at this point, by the way, has been renamed the Verizon Media Group. Maybe the fastest rerebranding in history. They've overpaid for media properties. The executives at Verizon had said that they're not going to be buying any more media properties or, we assume, media liabilities from here on out. It was an OK quarter. They're in the process of laying off about 10,000 people, which is hard. They need to raise about $10 million in cost-cutting because they've got a big network build-out coming in the 5G network. AA pretty tough set of facts for them, for a company that's not growing at all on its revenue base.

Hill: They're doing a pretty good job, in terms of subscribers. But it really does seem like if you're a Verizon shareholder, obviously you're not happy with the past 12 months. And at this point, you're probably crossing your fingers hoping, "OK, now that we've learned the lesson of drastically overpaying for media properties, can we stick to our knitting? Can we wring whatever value there is?" And I would say that there's some. I don't know what the value is, but there's some value to the content there. But, they're saying, "Please, can we stick to our knitting?"

Mann: [laughs] "Can we not do that anymore?" Yeah. In subsequent news, Verizon FiOS has just said that they've come to an agreement with Disney, so Disney won't be blacked out on FiOS. I believe that was nationwide, but it may have been on a property-by-property basis. Either way, that was going to be a fairly bad scene for both of the companies as well as for subscribers. Verizon is what it is. It's a large behemoth company that has huge capital expenses that come up from time to time because networks require not just maintenance, but upgrading.