Verizon Slips on Earnings Miss Despite Subscriber Growth

Verizon (VZ) shares dropped more than 5% soon after the opening bell Monday after the telecommunications giant posted second-quarter earnings that came in below analysts’ expectations despite adding subscribers to both its internet and mobile phone services.

Revenue grew less than 1% from the second quarter of fiscal 2023 to $32.8 billion, below the $33.06 billion analysts had expected, according to consensus estimates compiled by Visible Alpha. Net income slipped to $4.7 billion from $4.77 billion last year, while analysts had projected profit to grow to $4.84 billion.

Phone, Internet Services Adding Subscribers

Retail postpaid phone net additions came in at 148,000, short of the 265,800 additions analysts had anticipated. Verizon said it had 11.5 million broadband internet subscribers at the end of the quarter, which is 17% higher than the number Verizon reported last year.

Verizon also said its second-quarter performance keeps the company on track to meet its full-year projections. The company expects wireless service revenue to grow 2% to 3.5% from last year. Verizon also projects adjusted earnings per share (EPS) of $4.50 to $4.70, which would be below the $4.71 Verizon reported for fiscal 2023, while analysts expect adjusted earnings of $4.59 per share.

“We continue to build and expand on our strengths and successes with new products and services, and we are confident that this upward momentum will position us for future growth,” Verizon Chief Executive Officer (CEO) Hans Vestberg said.

Shares of the telecommunications giant fell 5.5% to $39.22 as of 9:42 a.m. ET Monday. They are up about 4% in 2024.