Verizon’s strategies, as reflected in the financial result, indicate a focused approach to driving growth in its wireless and broadband segments while maintaining profitability.
Verizon did not achieve a growth in its Q3 2024 revenue despite 5G network expansion and fiber. Q3 revenue of Verizon was $33.3 billion — generating $25.4 billion (up 0.4 percent) from Consumer and $7.4 billion (down 2.3 percent) from Enterprise Business.
Verizon added 389K broadband connections that include 363K Fixed Wireless Access (FWA) connections during the third quarter.
Verizon has 144.7 million mobile phone customers. Verizon added 239K wireless postpaid phone customers.
Wireless retail postpaid churn was 1.16 percent. Wireless retail postpaid phone churn was 0.89 percent.
Here are some key strategies that Verizon appears to be implementing:
# Wireless Expansion
Customer Acquisition: Verizon has significantly increased its wireless postpaid phone net additions year over year, achieving 239,000 net additions in Q3 2024. This focus on customer acquisition is crucial for growing its market share.
Reduced Churn Rates: With retail postpaid phone churn at 0.89 percent and overall retail postpaid churn at 1.16 percent, Verizon is effectively retaining customers, which is essential for sustainable growth.
Service Revenue Growth: Total wireless service revenue increased by 2.7 percent year over year, indicating successful monetization of its services through either pricing strategies or improved service offerings.
# Broadband Growth
Fixed Wireless Target Achievement: Verizon achieved its fixed wireless subscriber target 15 months ahead of schedule, showcasing its ability to meet customer demand for high-quality broadband services efficiently.
Consistent Subscriber Growth: The company reported total broadband net additions of 389,000 and 363,000 fixed wireless net additions, sustaining a trend of more than 375,000 broadband net additions for nine consecutive quarters. This consistency points to a successful strategy in expanding its broadband base.
Revenue Increase: Fixed wireless revenue of $562 million in Q3 2024, up $215 million year over year, indicates a growing customer base and effective service monetization.
# Profitable Growth Focus
Cost Management: The company’s consolidated net income dropped from $4.9 billion to $3.4 billion, primarily due to severance charges from a voluntary separation program. This indicates a focus on cost management and restructuring to streamline operations for long-term profitability.
Stable Revenue: Total operating revenue remained essentially flat at $33.3 billion compared to Q3 2023, reflecting a steady revenue stream amid changing market conditions.
# Capital Expenditure Management
Investment in Infrastructure: With capital expenditures targeted between $17.0 billion and $17.5 billion for 2024, Verizon is likely investing heavily in network expansion and enhancements, which are crucial for maintaining service quality and meeting increasing data demands. Verizon has already slashed its Capex to $14.2 billion in the first nine-months of 2024 from $12 billion in 9-months of 2023.
# Customer-Centric Product Development
Meeting Customer Demand: The rapid achievement of subscriber targets in fixed wireless services suggests that Verizon is effectively aligning its product offerings with customer preferences, focusing on high-demand services.
Verizon’s strategies are centered around expanding its wireless and broadband services while ensuring profitability through careful cost management and infrastructure investments. The emphasis on customer acquisition, retention, and aligning services with market demand positions Verizon well for sustained growth.
Baburajan Kizhakedath
