Verizon Raises Annual Profit Forecast After Surprise Wireless Subscriber Gain

• Verizon now expects 2026 adjusted profit between $4.95-$4.99 per share and forecasts full-year postpaid phone net additions in the upper half of its 750,000 to 1 million target range
• Q1 revenue of $34.4 billion missed estimates of $34.84 billion, partly due to $20 customer credits issued after a 10-hour January service outage
• The company's strategy of offering discounted bundles combining high-speed internet and wireless plans aims to boost customer retention, with results including contributions from the recently acquired Frontier

Summary

Key Development: Verizon raised its full-year 2026 profit forecast on April 27 after reporting better-than-expected first-quarter wireless subscriber additions, driven by competitive promotional strategies.

Subscriber Performance:

• Added 55,000 monthly bill-paying wireless subscribers in Q1, exceeding analyst expectations of a loss
• Company now expects full-year retail postpaid phone net additions in the upper half of its 750,000 to 1 million forecast range

Financial Results:

• Q1 adjusted profit: $1.28 per share, beating estimates of $1.25
• Total quarterly revenue: $34.4 billion, missing estimates of $34.84 billion
• Updated 2026 adjusted profit forecast: $4.95-$4.99 per share (previously unspecified)
• Wireless service revenue growth was impacted by $20 customer credits issued following a 10-hour January service outage

Strategic Initiatives:

• Revamped customer offers, including incentives for customers bringing competitor bills from AT&T and T-Mobile
• Bundled high-speed internet and wireless plans to improve customer retention
• CEO Dan Schulman emphasized a customer-centric approach to "reclaim market leadership"

Market Context:

• Results include Frontier operations following deal closure on January 20
• Strategy mirrors AT&T's approach of using discounted bundles to boost loyalty
• Performance signals intensifying competition among major wireless carriers

Implications: Verizon's subscriber turnaround suggests its promotional strategy is gaining traction, potentially pressuring rivals to respond with similar offers. However, revenue shortfall indicates these customer gains may come at margin pressure.