Verizon (VZ): Adds 406,000 phone customers in Q3 and raises 2026 forecast for a third time
Verizon, the US mobile and broadband company, said it added 406,000 postpaid phone customers in the third quarter, against 44,000 a year earlier, and raised its 2026 forecasts for the third quarter running. Profit per share beat analyst estimates, but sales of $34.3bn came in a little below them.
What happened
On 26 October 2026 Verizon Communications published its results for the three months to 30 September 2026 in a press release filed with the US Securities and Exchange Commission (SEC) on Form 8-K. The headline was customer growth. Verizon added 406,000 net postpaid phone customers, meaning people on monthly-bill contracts, after subtracting those who left. A year earlier the figure was 44,000. It also added 137,000 net postpaid accounts, which the company called its best result in over a decade, and churn, the share of customers who leave each month, fell to 0.94% from 0.98%. Chief executive Dan Schulman said the company is winning "loyal, high-value customers" by relying less on heavy handset discounts. Verizon also announced an agreement worth more than $2bn with Amazon Web Services (AWS) to supply computing capacity for artificial intelligence workloads.
The numbers, explained
Start with sales. Total operating revenue was $34,313m against $33,821m a year earlier, a rise of $492m, or 1.5% (492 / 33,821). Service revenue, the monthly fees customers pay, rose 3.5% to $29,197m, while wireless equipment revenue, the sales of phones, fell 9.0% to $5,116m from $5,619m, because customers upgraded less often (the upgrade rate was 2.6% against 3.3%) and Verizon spent less on handset discounts. Operating income, profit from running the business before interest and tax, was $8,650m against $8,105m, up 6.7%. That is a margin of 25.2% (8,650 / 34,313) against 24.0% (8,105 / 33,821). Net income was $5,320m against $5,056m, up 5.2% (264 / 5,056). These are GAAP figures, the standard US accounting rules, in US dollars.
Profit per share, which spreads profit over every share, was $1.25 against $1.17, up 6.8% (0.08 / 1.17). Net income attributable to Verizon shareholders rose only 5.0% (5,198 / 4,950), but the diluted share count, which includes shares that could be created from staff share awards, fell from 4,233m to 4,161m, or 1.7% (72 / 4,233), because of buybacks, so each remaining share gets a slightly larger slice. Adjusted profit per share, which removes items such as the amortisation (gradual write-off) of acquired intangible assets, was $1.31 against $1.21, up 8.3% (0.10 / 1.21). Adjusted EBITDA, earnings before interest, tax, depreciation and amortisation with one-off items removed, was $13,802m against $12,775m, up 8.0%, a margin of 40.2% against 37.8%. Free cash flow, cash from operations less spending on equipment and networks, was $7,801m against $6,956m, up 12.1% (845 / 6,956), helped by capital spending falling from $4,310m to $3,716m. Adjusted EBITDA and free cash flow are figures Verizon defines itself.
Why it matters
Verizon makes most of its money from mobile and broadband subscriptions, so the number of customers who stay and how much each pays matter more than phone sales. This quarter customer numbers improved while the cost of winning them fell: the company says its promotional cost of acquiring customers dropped 41% and of keeping them 30%. There are trade-offs in its own figures. Average revenue per account, a measure of what each household pays monthly, slipped 1.9% to $168.08 from $171.27. Interest expense rose 17.2% to $1,950m from $1,664m, and total debt was $166.2bn at 30 September against $158.2bn at the end of 2025. In the first nine months Verizon paid $9.5bn for acquisitions of businesses and $4.4bn for wireless licences, with no acquisitions in the same period of 2025, and net income for the nine months was 4.9% lower at $14,415m.
Broadband is the other growth line. Fiber connections, which use cables rather than copper or radio, reached 11,068 thousand, up 44.2% from 7,674 thousand, and fixed wireless access, home internet delivered over the mobile network, reached 6,369 thousand, up 18.1%. Total broadband connections were 17,437 thousand, up 33.5%. Fixed wireless additions slowed to 159,000 from 261,000 a year earlier, while fiber additions rose to 155,000 from 61,000. For the wider sector, Verizon's results show a market in which rivals such as AT&T and T-Mobile compete for the same customers; we have not compared their figures here. Independent coverage on Yahoo Finance reported that adjusted profit per share of $1.31 beat the $1.28 analysts expected, while revenue of $34.31bn missed the $34.77bn expected. Those expectations are analyst estimates, not facts reported by the company.
What to watch next
Verizon raised its own full-year forecasts, which are not yet facts. For 2026 it now expects 1.1 million to 1.2 million postpaid phone net additions (previously the upper half of 750,000 to 1.0 million), adjusted profit per share of $5.04 to $5.06 (growth of 7.0% to 7.5%, up from 6.0% to 7.0%), free cash flow growth approaching 12% (up from 9% to 10%) and mobility and broadband service revenue growth of about 4.0% in the fourth quarter. Capital spending is still expected at $16.0bn to $16.5bn. It said it still expects to buy back up to $4.5bn of shares this year, having bought $4.0bn in the first nine months, and it returned $12.8bn to shareholders in that period, made up of $8.8bn of dividends and $4.0bn of buybacks. The quarterly dividend declared was $0.7075 per share, up from $0.69. We did not find a confirmed date for the fourth-quarter results in the sources we read, so we give none, and we make no prediction about them.
- Postpaid: customers who pay a monthly bill, as opposed to prepaid customers who pay in advance
- Churn: the share of customers who leave in a given period
- Adjusted EBITDA: earnings before interest, tax, depreciation and amortisation, with one-off items removed
- Free cash flow: cash from operations less spending on equipment and networks
Sources
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