Verizon Communications (NYSE:VZ) outlined a broad transformation plan on its fourth quarter 2025 earnings call, highlighting strong subscriber momentum, the closing of its Frontier acquisition, and a shift in capital allocation that includes a larger shareholder return program. Management also addressed a recent network outage and emphasized a renewed focus on customer experience, churn reduction, and operational efficiency.
Management acknowledges outage, lays out “turnaround” approach
Chief Executive Officer Dan Schulman opened the call by acknowledging a network outage earlier in the month, saying Verizon “did not meet the standard of excellence our customers expect,” and committing to “relentlessly” improving reliability. Schulman described Verizon as being at a “critical inflection point” and framed the company’s efforts as “essentially a turnaround story,” with an emphasis on speed of execution, simplifying the customer experience, and building brand trust.
Fourth quarter volumes surge; churn remains a focus
Chief Financial Officer Tony Skiadas said Verizon finished 2025 with “strong operational momentum” and achieved its full-year financial guidance, including previously raised guidance for adjusted EBITDA, adjusted EPS, and free cash flow. In the fourth quarter, Verizon reported over 1 million net adds across mobility and broadband, which Skiadas called the company’s highest reported quarterly volumes in six years.
Key fourth quarter operating metrics highlighted on the call included:
- 616,000 postpaid phone net adds, including 551,000 consumer postpaid phone net adds, which management described as the best in several years.
- Core prepaid net adds of 109,000, marking the sixth consecutive quarter of positive customer growth, with continued momentum in the Visible and Total Wireless brands.
- Broadband net adds of 372,000, including 319,000 fixed wireless access (FWA) net adds and 67,000 Fios Internet net adds (management said the strongest fourth quarter for Fios net additions since 2020).
Despite the strong adds, Skiadas said postpaid phone churn remained elevated, citing prior pricing actions and competition. He said churn is a “pivotal opportunity” in 2026, and management expects investments in customer experience and increased convergence to improve retention over the next few quarters.
Frontier acquisition and fiber ambitions
Schulman said Verizon’s Frontier acquisition is “obviously crucial” to its converged strategy. He said the company now has “over 30 million fiber passings,” with a cross-sell opportunity because Verizon is “significantly under-penetrated” in wireless within Frontier markets. Verizon intends to add at least 2 million fiber passings this year and is targeting 40 million to 50 million fiber passings over the medium term.
On integration benefits, Schulman said Verizon now expects to realize more than $1 billion of run-rate operating cost synergies by 2028, which he said is double the initial estimate. He attributed the synergy expectations to network integration, third-party contract efficiencies, and go-to-market savings across marketing and advertising.
Skiadas also highlighted Frontier’s fourth quarter performance, saying it generated 125,000 fiber net additions, a 29% increase over the prior year. He said Frontier deployed approximately 1.3 million new fiber passings in 2025, bringing its footprint to more than 9 million fiber passings.
2025 financial results and balance sheet updates
In his prepared remarks, Skiadas said full-year 2025 wireless service revenue grew 2%. Consolidated adjusted EBITDA totaled $11.9 billion in the fourth quarter and $50 billion for the full year, which he described as industry-leading and up 2.5% from the prior year. Adjusted EPS was $1.09 in the fourth quarter and $4.71 for the full year.
Verizon generated $20.1 billion in free cash flow for 2025, with cash flow from operating activities of $37.1 billion and capital expenditures of $17 billion. Skiadas said Verizon’s C-band build-out is about 90% complete and covers approximately 300 million POPs. Net unsecured debt ended 2025 at $110.1 billion, a $3.6 billion improvement year over year, and net unsecured debt to consolidated adjusted EBITDA was 2.2x at year-end.
Skiadas said funding for the Frontier transaction was completed in the fourth quarter and came in favorable to Verizon’s original expectations. He added that Verizon expects to pay down approximately $5.7 billion of Frontier’s debt by the end of January and that unsecured leverage is expected to increase by approximately 0.25x once Frontier’s EBITDA contributions are factored in.
2026 guidance, capital allocation, and shareholder returns
Management positioned 2026 as a year of “measurable and improved performance,” while also describing it as transitional for revenue due to lapping prior-year pricing actions and promotional amortization. Skiadas said Verizon is guiding to 750,000 to 1 million postpaid phone net adds in 2026, representing roughly 2x to 3x its 2025 total. For revenue, Verizon guided to 2% to 3% mobility and broadband service revenue growth, which Skiadas said equates to approximately $93 billion, while wireless service revenue is expected to be approximately flat.
Verizon guided to adjusted EPS of $4.90 to $4.95 for 2026, or 4% to 5% year-over-year growth. Skiadas said the company is not guiding adjusted EBITDA, but expects adjusted EBITDA to grow faster than adjusted EPS. Capital spending is expected to be $16 billion to $16.5 billion, which management described as a $4 billion reduction versus the combined 2025 capital expenditures of Verizon and Frontier. Verizon also guided to free cash flow of $21.5 billion or more.
On capital allocation, Schulman reiterated four priorities: investing in the business, maintaining the dividend, maintaining a strong balance sheet, and returning cash to shareholders. Verizon said its board declared a dividend payable in May that represents an annualized increase of $0.07, or a 2.5% per share increase, marking the 20th consecutive year of dividend increases. Schulman also said the board authorized up to $25 billion of share repurchases expected to be completed over the next three years, including at least $3 billion of repurchases in 2026.
In the Q&A, Schulman emphasized that Verizon does not plan to rely on “price increases without corresponding value,” connecting prior pricing actions to higher churn. He argued that reducing churn by five basis points would get Verizon “halfway” to its postpaid phone net add target, and he pointed to convergence as a retention lever, stating that bundling can lead to a “40% reduction in churn versus standalone mobility” in Frontier markets. Management also discussed plans to simplify the customer experience and deploy AI at scale to reduce friction, personalize interactions, and proactively address customer pain points.
About Verizon Communications (NYSE:VZ)
Verizon Communications Inc (NYSE: VZ) is a major U.S.-based telecommunications company that provides a broad range of communications and information services. Its operations span consumer and business markets, with core offerings that include wireless voice and data services, fixed-line broadband and fiber-optic services, and enterprise networking solutions. Verizon is headquartered in New York City and operates a nationwide wireless network that supports consumer subscribers as well as business and government customers.
The company’s consumer products include mobile phone plans, unlimited data services, and Fios, its branded fiber-optic internet, television and voice service for homes and small businesses.
