Verizon Beats Q3 Earnings Estimates, Misses on Revenues

Verizon Communications Inc. VZ recorded solid third-quarter 2025 results with industry-leading wireless service revenues of $21 billion, up 2.1% year over year. However, while adjusted earnings beat the Zacks Consensus Estimate, revenues missed the same. The company registered solid broadband growth with total fixed wireless access net additions of 261,000, growing the subscriber base to nearly 5.4 million. The company remains well poised to achieve its target of 8 to 9 million fixed wireless access subscribers by 2028.    Net IncomeOn a GAAP basis, net income in the quarter was $5.06 billion or $1.17 per share compared with $3.41 billion or 78 cents per share in the prior-year quarter. The improvement was primarily attributable to top-line growth and lower operating expenses. Excluding non-recurring items, quarterly adjusted earnings were $1.21 per share compared with $1.19 in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 2 cents.Verizon Communications Inc. Price, Consensus and EPS Surprise Verizon Communications Inc. price-consensus-eps-surprise-chart | Verizon Communications Inc. QuoteRevenuesQuarterly total operating revenues improved 1.5% to $33.82 billion with growth in service revenues and higher wireless equipment revenues driven by targeted pricing actions, customer growth, sales of perks and add-on services and growth in fixed wireless access. The top line, however, missed the consensus estimate of $34.18 billion.Quarterly Segment ResultsConsumer: Total revenues from this segment improved 2.9% year over year to $26.1 billion with growth across all businesses. The segment revenues exceeded our estimate of $26.02 billion.Service revenues were up 2.1% to $20.34 billion, while wireless equipment revenues improved 6.4% to $4.77 billion. Other revenues totaled $1 billion, up 3.9% year over year.Wireless retail postpaid churn was 1.12%, while retail postpaid phone churn was 0.91%. The company recorded 61,000 Fios Internet net additions as high demand for reliable fiber optic broadband was spurred by higher video consumption. Verizon delivered 306,000 broadband net additions in the quarter. However, it registered 70,000 Fios Video net losses in the quarter, reflecting the ongoing shift from traditional linear video to over-the-top offerings.The segment’s operating income increased 0.8% to $7.66 billion with a margin of 29.4%. EBITDA improved 2% to $11.23 billion with a margin of 43% compared with 43.4% in the prior-year quarter due to lower costs of wireless equipment.Business: The segment revenues were down 2.8% to $7.14 billion due to lower wholesale and enterprise and public sector revenues, partially offset by growth in business markets and other revenues. It was also lower than our estimates of $7.3 billion, largely due to challenging macroeconomic conditions.The segment had 110,000 wireless retail postpaid net additions in the quarter, including 51,000 postpaid phone net additions. Wireless retail postpaid churn was 1.56%, while retail postpaid phone churn was 1.25%. Fixed wireless broadband net additions were 140,000 for the quarter. Operating income improved to $637 million from $565 million in the year-ago quarter with respective margins of 8.9% and 7.7%. Segment EBITDA was up 4.2% to $1.67 billion owing to an improvement in wireless service revenues for a margin of 23.4% compared with 21.8% in the year-earlier quarter.Other Quarterly DetailsTotal operating expenses were down 6.2% to $25.72 billion, while operating income improved 36.8% to $8.1 billion. Consolidated adjusted EBITDA increased to $12.77 billion from $12.49 billion, led by wireless service revenue growth and perceived benefits from lower upgrade volumes for respective margins of 37.8% and 37.5%.Cash Flow & LiquidityVerizon generated $28 billion of net cash from operating activities for the first nine months of 2025 compared with $26.48 billion in the year-ago period. Free cash flow was $6.96 billion for the quarter compared with $5.96 billion in the prior-year period.As of Sept. 30, 2025, the company had $7.71 billion in cash and cash equivalents with $126.63 billion of long-term debt.GuidanceFor 2025, Verizon continues to expect wireless service revenue growth in the range of 2%-2.8%. Adjusted EBITDA is expected to grow 2.5%-3.5%. The company expects adjusted earnings to grow 1-3% range with a cash flow of $37-$39 billion on capital expenditures of $17.5-$18.5 billion.Zacks Rank & Stock to ConsiderVerizon currently has a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Upcoming ReleasesArista Networks Inc. ANET is scheduled to release third-quarter 2025 earnings on Nov. 5. The Zacks Consensus Estimate for earnings is pegged at 72 cents per share, suggesting a growth of 20% from the year-ago reported figure.Arista has a long-term earnings growth expectation of 18.7%. Arista delivered an average earnings surprise of 12.8% in the last four reported quarters.Akamai Technologies, Inc. AKAM is slated to release third-quarter 2025 earnings on Nov. 6. The Zacks Consensus Estimate for earnings is pegged at $1.64 per share, indicating a 3.1% growth from the year-ago reported figure.Akamai has a long-term earnings growth expectation of 4.9%. Akamai delivered an average earnings surprise of 7.1% in the last four reported quarters.Pinterest, Inc. PINS is set to release third-quarter 2025 earnings on Nov. 4. The Zacks Consensus Estimate for earnings is pegged at 42 cents per share, implying a growth of 5% from the year-ago reported figure.Pinterest has a long-term earnings growth expectation of 33.9%. Pinterest delivered an average negative earnings surprise of 1.1% in the last four reported quarters.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Verizon Communications Inc. (VZ): Free Stock Analysis Report Akamai Technologies, Inc. (AKAM): Free Stock Analysis Report Arista Networks, Inc. (ANET): Free Stock Analysis Report Pinterest, Inc. (PINS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks