VZ FY2026 Q2 Improving

Verizon Communications Inc. earnings call

Jul 24, 2026 · 04:30 ET Colleen OstrowskiDan SchulmanTony Skiadas earningscall_biz

Buzzberg read

First positive Q1 postpaid phone net ads in 13 years

Verizon reported a strong Q1 2026 with positive postpaid phone net adds for the first time in 13 years, improved churn, and lower acquisition costs. Management raised full-year adjusted EPS and net ad guidance, citing momentum and a 10-stream transformation program. Key cross-company signals include partnerships with Google and Anthropic for AI, and deep discussions with hyperscalers for fiber-based AI infrastructure. Postpaid phone net adds of 55K in Q1, first positive Q1 in 13 years; churn improved to <85bps in March.

Buzzberg read First positive Q1 postpaid phone net ads in 13 years Verizon reported a strong Q1 2026 with positive postpaid phone net adds for the first time in 13 years, improved churn, and lower acquisition costs. Management raised full-year adjusted EPS and net ad guidance, citing momentum and a 10-stream transformation program. Key cross-company signals include partnerships with Google and Anthropic for AI, and deep discussions with hyperscalers for fiber-based AI infrastructure. Postpaid phone net adds of 55K in Q1, first positive Q1 in 13 years; churn improved to <85bps in March. Read full analysisCollapse analysis

Acquisition and retention costs down ~35% from Q4-end, structurally shifting marketing spend.
Raised FY2026 adjusted EPS growth guidance to 5-6% (from 4-5%) and postpaid phone net ads outlook to upper half of 750K-1M.
Free cash flow guide of $21.5B+ and capex of $16-16.5B reaffirmed; $2.5B in buybacks completed in Q1.

Revenue$34.253B-1% QoQ

EPS$1.30+8% QoQ

Gross margin47.18%Reported

Operating margin20.96%Reported

6 grounded callouts

What matters now

The highest-signal changes from the call.

Demand

First positive Q1 postpaid phone net ads in 13 years

Guidance

Adjusted EPS guidance raised to 5%-6% growth

Margins

Cost of acquisition and retention down ~35% in March

Show 3 more callouts

Demand

Consumer postpaid phone churn below 85 bps in March

AI tech stack substantially complete by July

Other

Free cash flow $3.8B, up 4% YoY

Reported period

Actuals

Metric	Reported	Change
Revenue	$34.253B	-1% QoQ
EPS	$1.30	+8% QoQ
Gross margin	47.18%	Reported
Operating margin	20.96%	Reported
Free cash flow	$6.426B	Reported
Capex	$4.009B	Reported

Forward-looking

Forward guidance

Metric	Period	Range	Midpoint	Status
Capex	FY2026	$16B–$16.5B	$16.25B	Maintained
EPS	FY2026	5%–6%	5.5%	Raised
Free cash flow	FY2026	$21.5B	$21.5B	Maintained
RevenueSERVICE	FY2026	2%–3%	2.5%	Maintained

AI, capex & demand read

Management read

Tone

confident

Management expressed strong confidence in the turnaround, citing improved metrics, raised guidance, and early transformation benefits, with no notable shift in confidence from prior calls.

Management AI read

Management discussed becoming an AI-first company, building an AI tech stack with four layers, working with partners like Google and Anthropic, and seeing improvements in customer satisfaction and energy savings. They also see potential for multi-billion revenues from integrating fiber and 5G to support AI infrastructure.

Capex

Investment and capacity

CapEx for Q1 was $4.2 billion, on track to full-year guidance of $16-$16.5 billion. Investments are prioritized toward wireless and fiber builds, with a target of over 32 million fiber passings by year-end.

all 5 named companies below

Companiesreturns since call

Partners

ANTHROPIC GOOGL +20.1%

Partners

Verizon's partnership with Anthropic for AI capabilities validates Anthropic's model deployment in large-scale telecom operations.

Evidence

“We are working very closely with Google and Anthropic and other best-of-breed AI players to bring this to life”

Dan Schulman

Supply chain

FTR

Supply chain

Verizon's integration of Frontier is progressing well, signaling that Frontier's assets and operations are being successfully folded into Verizon's broader broadband and convergence strategy.

Evidence

“Our frontier integration is on track, and I am extremely pleased with the level of teamwork and focus from go-to-market execution to network integration”

Dan Schulman

AAPL -4.2% 005930.KS -2.0%

Supply chain

Verizon reduced cost of acquisition and retention by ~35% in March relative to Q4-end, structurally lowering marketing spend while still growing net adds. — Lower device subsidies and retention offers may pressure handset upgrade volumes for Apple and Samsung as customers keep devices longer.

Evidence

“Our cost of acquisition and retention in March was down approximately 35% relative to the end of Q4”

Dan Schulman

External signals

Supply-chain alpha · 3returns since call

Verizon reduced cost of acquisition and retention by ~35% in March relative to Q4-end, structurally lowering marketing spend while still growing net adds.

Dan Schulman

AAPL-4.2%SMSN

Verizon is in deep discussions with hyperscalers to integrate fiber and 5G assets for AI infrastructure, with potential multi-billion revenue opportunity.

Dan Schulman

GOOGL+20.1%AMZN MSFT

Evidence

“We are in quite deep discussions right now with hyperscalers, with alternative cloud providers, large enterprises to integrate our fiber... to support their AI infrastructure efforts”

85% of network issues are now autonomously resolved using AI, and Verizon has saved over $200 million in energy costs through AI optimization.

Dan Schulman

Evidence

“85% of all of our issues right now are autonomously resolved... We already have over $200 million of energy savings as a result of deploying AI into the network”

Methodology & coverage

Management-only analysis. All 5 validated company mentions are shown. Reported actuals and forward guidance are kept separate. Public evidence is limited to eight short attributed quotes. AI-generated analysis can be incomplete or wrong; verify important claims against the original source.