Verizon exceeded expectations by adding more wireless subscribers than anticipated in the third quarter. The U.S. telecom giant’s promotional offers and bundled plans, which include 5G along with streaming services like Netflix, played a key role in attracting customers.
The increasing popularity of Verizon’s myPlan, a customizable package that offers streaming benefits such as Disney+, Hulu, and Max for an additional fee, has helped the company remain competitive in the U.S. telecom market.
In the September quarter, Verizon added 239,000 net monthly bill-paying wireless phone subscribers, surpassing the expected 218,100 additions, according to FactSet. This was an improvement from the 148,000 additions reported in the June quarter.
The postpaid phone churn rate, which measures the number of customers canceling the service each month, was 0.89% in the third quarter, slightly higher than the 0.85% recorded in the second quarter.
As the U.S. wireless market approaches saturation, Verizon and its competitors are exploring opportunities to expand their high-speed internet business to meet the growing data demands of consumers. Last month, the company announced its acquisition of fiber-optic internet provider Frontier Communications in a $20 billion deal.
Verizon’s fixed wireless service, which transmits signals to devices in homes or businesses over the airwaves, gained 363,000 customers, reaching a total of nearly 4.2 million subscribers. This achievement met the company’s target of 4 to 5 million subscribers well ahead of schedule.
Excluding exceptional items, Verizon reported earnings of $1.19 per share, slightly higher than the estimated $1.18, as per data compiled by LSEG.
However, the total revenue of $33.3 billion fell slightly short of analysts’ projections of $33.43 billion, primarily due to decreases in wireless equipment revenue. Customers reduced spending on phone upgrades amid high interest rates, leading to lower revenue in this segment.
Verizon’s stock price declined by 1.3% in premarket trading.
Net income decreased to $3.4 billion from $4.9 billion compared to the previous year, influenced by severance charges of $1.7 billion related to a voluntary separation program and other workforce reduction initiatives.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Devika Syamnath)