VZ · Q4 2025 Earnings

Bullish

Verizon

Reported January 30, 2026

30-second summary

New CEO Dan Schulman delivered his first full strategic and financial reset 100 days in, and the FY2026 framework is a step-function break from the prior five-year arc: adjusted EPS guided to $4.90–$4.95 (+4–5% YoY off the $4.71 FY2025 actual), free cash flow to ≥$21.5B (+7%+ YoY), and capex guided to $16.0–16.5B vs. FY2025 actual $17.0B (down ~$750M), or a combined $4B improvement vs. Verizon+Frontier 2025 levels per management. Q4 itself delivered 616K postpaid phone net adds (the operational headline) and 319K FWA net adds (back above the 300K threshold the prior watch list flagged), while the FY2026 postpaid phone target of 750K–1.0M implies 2–3x the FY2025 reported result. The cleanest bear-case data points: wireless service revenue guided to "approximately flat" in 2026 (a deceleration from the +2.0% FY2025 actual), and the 13,000-person workforce reduction in Q4 making the $5B opex savings claim concrete.

Headline numbers

EPS

Q4 FY2025

$1.09

Revenue

Q4 FY2025

$36.40B

+2.0% YoY

Operating margin

Q4 FY2025

13.8%

Key financials

Q4 FY2025

Metric	Q4 FY2025	YoY	Q3 FY2025	QoQ
Revenue	$36.40B	+2.0%	$33.82B	+7.6%
EPS	$1.09	—	$1.21	-9.9%
Operating margin	13.8%	—	24.0%	-1023bps

Guidance

Verizon raised FY2026 EPS guidance to $4.90–$4.95 (+4–5% YoY) and FCF to ≥$21.5B (+7% YoY), but cut capex $1.5–2.0B and narrowed OpCash guidance, signaling operational leverage amid a stated 'step function' turnaround.

Guidance is issued for both next quarter and the full year. Both may appear below.

New guidance

Metric	Period	Guide	YoY
Adjusted EPS	FY 2026	$4.90 to $4.95	+4.0% to +5.0% YoY
Mobility and Broadband Service Revenue Growth	FY 2026	2.0% to 3.0%	—
Wireless Service Revenue Growth	FY 2026	approximately flat	—
Total Retail Postpaid Phone Net Additions	FY 2026	750,000 to 1.0 million	—
Fiber Build Pace	FY 2026	at least 2.0 million passings	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Adjusted EPS Growth	FY 2025	1.0% to 3.0%	4.71 (actual, +4.2% YoY vs FY2024)	+1.2 to +3.2 pts above prior guidance midpoint	Raised
Cash Flow from Operations	FY 2026	$37.0 billion to $39.0 billion	$37.5 billion to $38.0 billion	Narrowed midpoint; prior $38.0B midpoint → new $37.75B midpoint (-$250M).	Raised
Capital Expenditures	FY 2026	$17.5 billion to $18.5 billion	$16.0 billion to $16.5 billion	-$1.5B to -$2.0B vs prior range	Lowered
Free Cash Flow	FY 2026	$19.5 billion to $20.5 billion	$21.5 billion or more	+$1.0B to +$2.0B above prior high end; +7% YoY growth vs FY2025 actual $20.1B	Raised
Adjusted EBITDA Growth	FY 2025	2.5% to 3.5%	Withdrawn — no replacement	—	Withdrawn

Segment performance

Q4 FY2025

Segment	Q4 FY2025	YoY
Consumer	$28.4B	+3.2%
Business	$7.4B	-1.8%
Wireless Service Revenue	$21B	+1.1%
Wireless Equipment Revenue	$8.2B	+9.1%

Platform metrics

Q4 FY2025

Segment	Q4 FY2025
Total Postpaid Phone Net Additions (Q4)	616,000
Total Mobility & Broadband Net Additions (Q4)	1,000,000+
Fixed Wireless Access Net Additions (Q4)	319,000
Fios Internet Net Additions (Q4)	67,000
Fixed Wireless Access Base	5.7 million
Postpaid Phone ARPA	$170.61

Profitability

Q4 FY2025

Segment	Q4 FY2025
Operating Income Margin	13.75%
Net Unsecured Debt to Adjusted EBITDA	2.2x

Management tone

Q2 2025 inflection narrative → Q3 2025 Schulman cost-transformation signal → Q4 2025 full turnaround plan with concrete dollars.

The pricing model was explicitly disowned. Two quarters ago the equity story rested on Value Guarantee, perks expansion, and MyPlan as ARPA levers — pricing-led monetization with retention scaffolding. This quarter Schulman draws a line through that strategy: "We will not rely on empty price increases to drive short-term revenue and earnings. That is not a sustainable financial model nor an engine of long-term growth." The "approximately flat" wireless service revenue guide is the financial expression of this — management is choosing to lap and absorb the 2025 price-increase headwind rather than layer new ones. That's a material strategic break.

Cost transformation moved from posture to dollars. In Q3, Schulman telegraphed "aggressively transform our cost structure" without numbers. This quarter the figures landed: $5B opex savings targeted in 2026, 13,000 workforce reduction executed in Q4 (with ~80% off payroll in Q4 and the remainder in Q1), and Frontier synergy targets doubled from initial estimates to "over $1 billion run rate by 2028." The capex step-down to $16.0–16.5B is the most visible expression of the cost reset — management framed it as enabled by C-band buildout reaching 90% completion plus narrowed scope (eliminating legacy business wireline, copper, voice platforms).

Cultural framing turned offensive. Q3's Schulman quote was apologetic — "we did not meet the standard of excellence." This quarter the language inverts: "The prevailing attitude inside Verizon is that we are now going to play to win, and we will never again be content to be the hunting ground where our competitors take our share and our customers." That is a meaningful departure from incumbent-telecom defensive positioning and aligns with the 750K–1.0M postpaid phone net add target (2–3x FY2025).

EPS trajectory reframed against a five-year baseline. Management deliberately anchored the FY2026 +4–5% EPS guide against the prior five-year average of approximately −1%. That framing — "step function improvement" — is the strongest forward signal in the print and positions FY2026 as the inflection year rather than a transition year despite the "transitional" hedge.

Recurring themes management leaned on this quarter:

Transformation as turnaround story with 'play to win' mindset shiftVolume-based growth replacing price-increase dependencyFiber convergence and broadband as co-equal growth driver with mobilityAI-first operating model for efficiency and hyper-personalized customer experienceAggressive cost structure redesign ($5B OPEX savings, workforce reduction) enabling reinvestment flexibilityCapital allocation discipline with dividend increases, debt reduction, and new $25B buyback authorization

Risks management surfaced:

Postpaid phone churn remains elevated from prior pricing actions and competition2026 described as transitional revenue year while lapping prior price increases and absorbing promo-amortizationTransformation execution risk: 'we are still in the very early stages of our transformation'Public sector wireless headwinds from government efficiency efforts and federal shutdownCompetitive intensity and market share defense still required despite Q4 momentum

Q&A highlights

Michael Ng · Goldman Sachs

How will Verizon drive the 750K-1M postpaid phone net adds target in 2026? Will improvements come from churn reduction or increased marketing/promotions? Also, what drove the fiber passings outlook increase from $35-40M to $40-50M?

Management stated they can achieve targets through 5bps churn reduction alone, without heavy promotional reliance. Churn drivers include price increases without value (which they're eliminating), and they'll invest in customer experience and leverage convergence (40% churn reduction vs standalone). Fiber target increase driven by Frontier acquisition, Starry acquisition for MDUs, and organic opportunities, with flexibility for inorganic growth.

616,000 postpaid phone net adds in Q4750,000 to 1,000,000 postpaid phone net adds target for 2026Represents 10-15% of net new to industry5bps churn reduction achieves 50% of target

Ben Swinburne · Morgan Stanley

How is Verizon ensuring high-quality customer acquisition as it pursues aggressive growth? What are the risks to customer lifetime value (CLV) in 2026-27? Also, where are the CapEx efficiencies coming from if they're cutting $2B from prior run rate with no revenue impact?

On CLV, management emphasized new-to-Verizon customers (highest LTV), churn reduction through eliminating price increases without value, reducing friction in onboarding/billing/service, and convergence benefits. CapEx efficiency comes from narrowed focus to mobility/broadband, eliminating legacy areas (business wireline, copper, voice platforms), and unit cost improvements. 16-16.5B envelope sufficient for all growth initiatives.

Strong new-to-Verizon customer acquisition in Q4Four reasons for churn: price increases without value, process friction, price perception, competitive intensityCapEx guidance: 16-16.5 billion90% of plant sites have C-band; substantially complete in 2026

John Hudlick · UBS

What are the key drivers of flat wireless service revenue growth and organic EBITDA growth? Specifically: what are promo AMR headwinds and wholesale tailwinds? What volumes should be expected for broadband (fiber and FWA) in 2026?

Wireless service revenue flat due to 180bps headwind from 2025 price increases, ongoing promo amortization, offset by 750K-1M postpaid net adds, perks/step-ups, and wholesale growth. Broadband growth from FWA and fiber volume, including Frontier's 500K net adds. EBITDA growth faster than EPS due to Frontier contribution, cost transformation ($5B), and legacy business reduction. No specific EBITDA guidance given but strong operating leverage expected.

2-3% mobility and broadband service revenue growth guidanceFlat wireless service revenue guidance for 2026180 basis points headwind from 2025 price increasesPromo amortization continuing as headwind

Michael Rollins · Citigroup

Beyond eliminating price-only increases, what opportunities exist for Verizon to inject more value and capture better ARPUs over time? When can Verizon pursue this? What specific cost savings has Verizon identified for 2027-2028 beyond the 2026 plan?

Management outlined three waves of efficiency: (1) eliminate underperformance and inefficiencies, (2) reduce complexity in customer promise/value proposition, (3) automate remaining processes. On value-based pricing, management stated the path requires regaining brand trust first by stopping things customers hate and improving end-to-end experience. Once trust is regained, Verizon can add incremental value (e.g., gig plus broadband) without pure price increases.

Three waves of efficiency identified: remove underperformance, reduce complexity, automate processesValue-based pricing requires brand trust recovery firstBrand trust recovery requires: stopping customer-hated practices, improving end-to-end experience, simplicity focusGig plus broadband cited as example of real value addition

Michael Ng · Goldman Sachs

Follow-up on fiber passings: Was the $40-50M target increase driven by opportunities within existing footprint or expansion into new markets? Discussion of inorganic/partnership opportunities?

Increase driven by both internal and external opportunities. Closed Frontier acquisition with significant embedded opportunities. Acquired Starry for MDU capabilities. Tillman partnership can scale to standards at good economics. Balance sheet has capacity for additional acquisitions and partnerships. Management comfortable with range based on Frontier performance and internal Verizon capabilities.

Frontier acquisition closedStarry acquisition for MDU capabilitiesTillman partnership for scaled build$40-50 million fiber passings target medium-term

Answers to last quarter's watch list

What Schulman's "transform our cost structure" plan actually looks like — Concrete and quantified: $5B opex savings in 2026, 13,000 workforce reduction in Q4 (80% off payroll in Q4, remainder Q1), Frontier synergies doubled to >$1B run rate by 2028, capex stepped down vs. prior range. The plan is the strongest commitment of the print.

Resolved positively

Whether Business revenue decline narrows or widens from Q3's −2.8% — Q4 Business revenue declined −1.8%, a narrowing of one point but still negative. Public-sector headwinds (federal shutdown, government efficiency) flagged as continuing. Direction improved but not yet positive.

Continue monitoring

Consumer postpaid phone net adds recovery from the −7K Q3 print — Consumer postpaid phone net adds of 551K in Q4 (segment disclosure confirms the snap-back); total postpaid phone net adds of 616K. The headline volume snap-back was decisive; FY2026 guide of 750K–1.0M implies the trajectory continues.

Resolved positively

Actual FY CapEx outturn vs. the $17.5–18.5B range — FY2025 capex outturn was $17.0B, below the prior $17.5–18.5B guided range. The FY2026 step-down to $16.0–16.5B builds on that efficiency.

Resolved positively

FWA net adds trajectory after Q3's 261K — Q4 FWA net adds of 319K cleared the 300K threshold; base now 5.7M. The C-band-to-FWA-passings cadence appears to have re-synced.

Resolved positively

FY2026 capital framework and any Frontier-close disclosures — Full framework issued: EPS, mobility & broadband service revenue, postpaid phone adds, FCF, opex savings, fiber build pace, and a new $25B buyback authorization. Frontier closed and synergies doubled. Schulman delivered the framework on schedule.

Resolved positively

What to watch into next quarter

Whether postpaid phone net adds Q1 2026 tracks toward the 750K–1.0M FY pace — at ~midpoint cadence that implies ~190K–250K per quarter; a sub-150K Q1 print would put the FY target at risk and rekindle competitive-position questions.

Wireless service revenue YoY trajectory vs. "approximately flat" — Q1 will lap the first of the 2025 price increases; a print materially below flat would suggest the 180bps headwind is larger than disclosed.

Capex run-rate Q1 vs. the new $16.0–16.5B framework — Q1 needs to print in the ~$4.0–4.1B vicinity to validate the step-down; a higher print suggests the cut was timing-driven rather than structural.

Whether the workforce reduction completes cleanly in Q1 with no residual restructuring charges beyond what's already disclosed — additional charges would undermine the $5B opex savings credibility.

First quantitative FY2026 adjusted EBITDA disclosure — the EBITDA guide was withdrawn without replacement; analysts will press for a number or a directional band, and silence on Q1 would itself be informative.

Frontier integration disclosures: revenue contribution, synergy realization pace, and whether the doubled $1B+ by 2028 target is on schedule — Q1 will be the first clean quarter of full Frontier inclusion.

Sources

Verizon Q4 2025 press release / 8-K exhibit, filed 2026-01-30: https://www.sec.gov/Archives/edgar/data/732712/000073271226000003/a2025q4exhibit99.htm
Verizon Q4 2025 earnings call commentary (Dan Schulman, Tony Skiadas, and analyst Q&A).

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