Verizon Communications Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total operating revenue reached $34.3 billion, a 1.5% increase year-over-year.
• Mobility and broadband service revenue was $23.5 billion, up 2.9% year-over-year.
• Equipment revenue declined 9.0% year-over-year to $5.1 billion due to lower upgrade volumes and reduced device subsidies.
• Consolidated net income was $5.3 billion, a 5.2% increase year-over-year, with a net income margin of 15.5%.
• Consolidated Adjusted EBITDA was $13.8 billion, an 8.0% increase year-over-year, representing the highest quarterly result in company history.
• Consolidated Adjusted EBITDA margin improved to 40.2% from 37.8% year-over-year.
• Earnings per share (EPS) was $1.25, up 6.8% year-over-year; Adjusted EPS was $1.31, up 8.3% year-over-year.
• Cash flow from operating activities was $11.5 billion, up 2.2% year-over-year.
• Free cash flow was $7.8 billion, up 12.1% year-over-year.
• For the first nine months of 2026, cash flow from operations was $29.9 billion (up 7.0% year-over-year) and free cash flow was $18.0 billion (up 14.3% year-over-year).
• Capital expenditures were $11.9 billion for the first nine months of 2026.
• Total unsecured debt was $136.1 billion as of the end of the third quarter; net unsecured debt was $123.7 billion.
• The ratio of unsecured debt to consolidated net income (LTM) was 8.1 times, and net unsecured debt to consolidated Adjusted EBITDA was 2.3 times.
• Verizon returned $12.8 billion to shareholders in the first nine months of 2026, including $8.8 billion in dividends and $4.0 billion in share repurchases.

Guidance and Future Outlook:

• Verizon raised full-year 2026 guidance for the third consecutive quarter.
• Postpaid phone net additions guidance increased to 1.1 million to 1.2 million, up from the previous upper half of 750,000 to 1.0 million.
• Adjusted EPS guidance increased to $5.04 to $5.06, representing 7.0% to 7.5% growth year-over-year.
• Cash flow from operations growth guidance increased to 3.5% to 5.0% year-over-year.
• Free cash flow growth guidance increased to approximately 12.0% year-over-year.
• Mobility and broadband service revenue guidance is set to the upper half of the annual range (2.5% to 3.0% growth), with fourth-quarter 2026 growth forecast at approximately 4.0%.
• Capital expenditures for 2026 are expected to be $16.0 billion to $16.5 billion.
• Total fiber passings are anticipated to exceed 32 million by year-end, with a medium-term target of 40 to 50 million.

Business Segments and Product Lines:

• Postpaid phone net additions totaled 406,000 in Q3 2026, a more than 820.0% increase year-over-year, marking the strongest third-quarter performance in five years.
• Postpaid net account additions reached 137,000, the best performance in over a decade.
• Verizon acquired nearly 1.7 million mobility and broadband subscribers in the first nine months of 2026, compared to 879,000 in the same period in 2025.
• Broadband net additions were 314,000 in Q3 2026, comprising 159,000 fixed wireless access (FWA) and 155,000 fiber broadband additions.
• Total broadband connections reached 17.4 million, with more than half of new fiber customers choosing 1-gigabit-plus download speeds.
• Consumer segment operating income was $8.1 billion for the quarter, up 5.6% year-over-year, with segment EBITDA of $12.0 billion.
• Business segment operating income was $855 million for the quarter, up 19.4% year-over-year, with segment EBITDA of $1.9 billion.
• Postpaid phone churn improved 4 basis points year-over-year to 0.94%; consumer postpaid phone churn improved to 0.87%.
• Promotional cost of acquisition decreased 41% year-over-year, and promotional cost of retention improved by 30% year-over-year.

Market and Competitive Landscape:

• Verizon expanded its strategic partnership with Amazon Web Services (AWS) via a commercial framework valued at over $2.0 billion to scale distributed compute for agentic and generative AI workloads.
• Technology leaders are selecting Verizon's fiber network to power the next generation of AI infrastructure.
• The company is prioritizing customer-first offerings like "Simplicity" and an expanded loyalty program over heavy subsidies to win loyal, high-value customers.
• The average time customers keep mobile devices continues to increase, influencing the strategic decision to reduce device subsidies.

Risks and Challenges:

• Forward-looking statements are subject to risks including competition on prices, promotional incentives, network performance, and evolving consumer preferences.
• Risks include the inability to successfully respond to competitors' use of technology developments, including artificial intelligence.
• Potential adverse conditions in the U.S. and international economies, including inflation and changing interest rates.
• Risks related to cyberattacks, system failures, and disruptions to networks or operations.
• Significant outstanding debt and potential adverse changes in credit ratings or credit market conditions.
• Regulatory environment changes, including restrictions on network operations or increased compliance costs.
• Litigation, including material adverse changes in benefit plan costs or tax law challenges.

Management Commentary and Tone:

• Dan Schulman, CEO, stated that Verizon is "fundamentally stronger — operationally, financially, and competitively" one year into its transformation.
• Management expressed confidence that the company is "continuing to raise the bar" and is "only one year into a multi-year growth story."
• The tone emphasized strong sustained cash flow generation, reduced churn, and expanded margins driven by disciplined business model evolution.

Other Key Points:

• The company expects to repurchase up to $4.5 billion of common stock for the full year 2026.
• In the second quarter of 2026, Verizon's international wireline connectivity and managed network services business was classified as held for sale and moved from the Business segment to Corporate and other.
• Verizon generated revenues of $138.2 billion in 2025.
• The company serves nearly all of the Fortune 500 and operates in countries worldwide.