💰 Market Cap: $166B | 🏢 105K Employees | 🌍 Americas + Global

👨‍💼 CEO Dan Schulman | 🎯 Customer-First Transformation | 🇺🇸 New York City

$40.17

📈 +$0.85 (+2.17%) Today

-13.2% YTD | Q3 2025 Beat on EPS

🚀 Needs:

Schulman's "customer champion" transformation delivers industry-leading churn below 0.85% by late 2026 • Captures "fair share" of 5-8M annual new-to-industry postpaid adds vs current 0-5% share • Frontier integration generates $500M+ revenue synergies from 29M fiber passings and wireless under-indexing in Frontier territory • Converged customers grow from 18% to 30%+ of base leveraging 40% lower churn advantage • "Significant cost transformation" and AI-driven efficiencies fund customer investments and drop to bottom line • FWA reaches 6.5M+ subs by end 2026 on path to 8-9M by 2028 • Market re-rates VZ as growth story, expanding P/E to sector average

⚖️ Needs:

Maintains current wireless service revenue growth of 2-2.8% range through 2026 • Postpaid phone churn stabilizes at current ~0.91% level without further deterioration • Broadband adds 300K+ per quarter driven by FWA and Fios momentum • Adj EBITDA growth of 2.5-3.5% continues as guided • Free cash flow of $19.5-20.5B enables deleveraging and dividend support • Frontier deal closes Q1 2026 without major integration issues • New CEO's initiatives show early traction but measured progress

⚠️ Risk:

Account losses accelerate beyond Q3's highest level since pandemic Q1 2020 as transformation takes 2-3 years • T-Mobile and AT&T maintain share momentum while VZ struggles to capture "fair share" of new-to-industry adds • Churn rises above 1% as competitors target VZ's base with aggressive switcher offers • Schulman's "bold" changes face internal resistance or execution delays in shifting from tech-centric to customer-centric culture • Cost transformation insufficient to fund customer investments without margin compression • Public sector disconnect pressure intensifies from "government efficiency efforts" • Frontier integration complexity distracts management and delays revenue synergies • Promo amortization headwind continues to pressure service revenue growth • CapEx efficiency targets prove unrealistic, forcing FCF guidance cut

💰

What Happened

Revenue Miss: $33.8B up 1.5% YoY but missed $34.2B consensus - Business segment down 2.8% offset Consumer +2.9% growth

EPS Beat: Adj EPS $1.21 vs $1.19 est (+1.7% YoY) driven by cost controls and EBITDA growth of 2.3% to $12.8B

Postpaid Mixed: Gross adds up 8.4% YoY, 0.91% churn decent, but 7K net losses - highest account losses since Q1 2020

Broadband Strength: 306K adds (261K FWA now 5.4M/$3B+ annual revenue, 61K Fios best in 2 years) - base 13.2M up 1.3M YoY

Cash Flow King: Q3 FCF $7B up 17% YoY - highest in industry by $2B - YTD $15.8B up 9%, leverage 2.2x inside target

📈

Why It Matters

Blunt Assessment: Schulman: "We are clearly falling short of our potential and not delivering shareholder returns investors expect" - stock reflects this reality

Converged Power: 18% of postpaid base now converged (up 200bps YoY) with 40% lower churn than mobility-only - massive opportunity in Frontier's 29M passings

2026 FCF Growth: CFO commits 2026 FCF will exceed 2025 even including Frontier - Q3 FCF $7B highest in industry by nearly $2B

Competitive Wake-Up: VZ captures 0-5% of 5-8M annual new-to-industry postpaid adds - Schulman vows to win "fair share" responsibly

Culture Shift: "Not course correction but fundamental change" from tech-centric to customer-first - AI will personalize offers and reduce costs

🎯

What's Next

2025 On Track: Reiterated wireless service +2.0-2.8%, adj EBITDA +2.5-3.5%, adj EPS +1-3%, FCF $19.5-20.5B - YTD tracking top end

Frontier Integration: Deal closing Q1 2026 after 11 of 13 state approvals - Frontier "performing extremely well" above deal expectations

4 Strategic Pillars: (1) Grow share of industry net adds via customer delight (2) Cost transformation (3) Capital efficiency (4) Accelerate shareholder returns

Tillman Fiber Expansion: Capital-light partnership to build fiber outside VZ/Frontier footprint using Fios brand for more convergence opportunity

January Deep Dive: Full 2026 guidance plus details on portfolio rationalization, legacy business exits, and multi-year transformation roadmap

💡

Bottom Line for Retail Investors

Schulman delivered a brutally honest assessment: "We are clearly falling short of our potential and not delivering shareholder returns investors expect." The Q3 results prove it - highest account losses since pandemic Q1 2020 despite decent 0.91% churn and 8.4% gross add growth. But here's why this matters: Schulman isn't sugar-coating anything. His mandate is clear - grow customer base profitably across mobility and broadband, with VZ currently capturing just 0-5% of the 5-8M annual new-to-industry postpaid adds. The convergence story is real: 18% of postpaid base is converged with 40% lower churn, and Frontier's 29M fiber passings offer massive cross-sell runway. Most important: CFO committed 2026 FCF will EXCEED 2025 even including Frontier integration. At 8x forward P/E with 7% yield, you're betting on a 2-3 year transformation where cost cuts fund customer investments and AI personalizes the value prop. Not a momentum play, but potentially the most undervalued turnaround story in telecom if you believe in Schulman's track record. January guidance will be the key test.

🔄

Transformational CEO

Customer Champion DNA: At PayPal declared "customer champion" mission - "doing what customers expect, addressing pain points, then delight and surprise"

Telecom Roots: Started at NJ Bell, 18 years at AT&T (Consumer President), founded Virgin Mobile to 5M+ subs with "no hidden fees" disruption

Turnaround Expert: "Big companies are extraordinarily good at responding to crisis" - this is clarion call to reclaim market leadership

Board Insider: 7 years on VZ board as Lead Director - knows exactly what needs fixing, detailed January roadmap coming

📡

Broadband Powerhouse

FWA Scale: 5.4M subs generating $3B+ annualized revenue, path to 8-9M by 2028 - "long-term sustainable business"

Fios Acceleration: 61K Q3 adds best in 2 years - expanding within existing footprint where demand is strong

Frontier Upside: $20B deal adds 29M fiber passings where VZ wireless "significantly under-indexes" - massive cross-sell from day one

Tillman Expansion: Capital-light partnership to build fiber outside VZ/Frontier footprint using Fios brand - "optionality we did not have before"

💵

Cash Flow Machine

Industry Leader: Q3 FCF $7B up 17% YoY - "highest reported in our industry by nearly $2B for the period"

2026 Commitment: CFO Tony Skiadas stated "we expect free cash flow growth in 2026 year over year, all-in including Frontier"

Leverage Ahead of Plan: Net debt/EBITDA 2.2x inside 2.0-2.25x target range BEFORE Frontier close - Frontier adds just 0.25x temporarily

Dividend Sacrosanct: Schulman: "dividend is sacrosanct to us" - 19th consecutive increase, 7% yield sustainable with strong FCF

💎

Valuation Opportunity

Deep Discount: Trading at 8.0x forward P/E vs telecom sector avg 12x and S&P 500 at 19x

Yield Advantage: 7% dividend yield significantly above T-Mobile (3.1%) and AT&T (5.5%) for income seekers

Re-rating Potential: If Schulman delivers on transformation, stock could re-rate toward sector P/E for 40%+ upside

Downside Protection: Strong balance sheet, stable cash flows, and subscriber base provide floor at these levels

📉

Subscriber Losses Continue

Historic Losses: Account losses worst since Q1 2020 pandemic quarter despite 8.4% gross add growth - VZ capturing 0-5% of new-to-industry adds

Switcher Vulnerability: Schulman admits "clearly losing share and that's not sustainable path" - 5-8M annual new postpaid market largely going to rivals

Top 4 Churn Drivers: (1) Price increases (2) Friction in customer experience (3) Value perception vs competitors (4) Competitive intensity

Pricing is "Last Refuge": Schulman: "Pricing is last refuge of the marketing desperate" - implies past over-reliance on price hurt customer base

⏰

Transformation Uncertainty

Multi-Year Journey: Schulman: "This will not happen overnight, there's no one silver bullet" - 2-3 year transformation timeline tests investor patience

Massive Cultural Lift: "I don't want to underestimate how big a shift that is" moving from technology-centric to customer-centric organization

Cost Cuts Must Deliver: Entire transformation funded by OpEx savings - if costs don't come out fast enough, margins compress and strategy fails

Details Deferred: Schulman promises "more specifics in January" on portfolio rationalization and legacy exits - execution risk until then

🎯

Competitive Intensity

Respect for Rivals: Schulman: "Both AT&T and T-Mobile are excellent companies with strong leaders in John and Srini. I have ton of respect"

Share Reality: T-Mobile and AT&T capturing majority of 5-8M annual new-to-industry postpaid adds while VZ gets 0-5% share

Won't Get Irrational: "No need to ratchet up high promotional spend...no reason to be irrationally aggressive" - but how to win without promos?

Gravity Analogy: Schulman views competition "like gravity" - always there, can't wish it away, must learn to operate within it effectively

💰

Integration & Leverage Risks

Frontier Burning Cash: Frontier currently burning ~$1B annually in fiber buildout - VZ must deliver 2026 FCF growth "all-in including Frontier"

Quarter Turn Add: Frontier adds 0.25x to leverage temporarily per CFO - commitment to stay in 2.0-2.25x range "is not going to change"

Integration During Turnaround: Closing Q1 2026 during CEO's first 6 months risks divided focus between transformation and deal execution

Portfolio Rationalization: Schulman promises "aggressively sunset or exit legacy businesses" with "billions of dollars of margin" at stake