Verizon(US:VZ)2025-04-25 13:35Revenue Performance - Verizon's Consumer segment reported operating revenues of $25.6 billion for the three months ended March 31, 2025, an increase of 2.2% compared to $25.1 billion in the same period of 2024[158] - The Business segment's operating revenues decreased by 1.2% to $7.3 billion for the three months ended March 31, 2025, down from $7.4 billion in the prior year[160] - Consolidated operating revenues increased by 1.5% to $33.5 billion for the three months ended March 31, 2025, compared to $33.0 billion in 2024, driven primarily by the Consumer segment's revenue growth[170] - Total operating revenues for the three months ended March 31, 2025, increased to $25,618 million, up 2.2% from $25,057 million in 2024[221] - Wireless service revenue rose to $17,199 million, reflecting a 2.6% increase compared to $16,760 million in the same period last year[221] Operating Expenses and Income - Operating expenses for the three months ended March 31, 2025, totaled $18,194 million, an increase of 2.9% from $17,685 million in 2024[226] - Segment operating income for the Consumer segment was $7,424 million, a slight increase of 0.7% from $7,372 million in the previous year[232] - The Business segment's total operating revenues decreased by 1.2% to $7,286 million, primarily due to declines in Enterprise and Public Sector revenues[236] - Total operating expenses decreased by $355 million, or 5.1%, to $6,622 million for the three months ended March 31, 2025, compared to $6,977 million in 2024[244] - Segment operating income increased by $265 million, or 66.4%, to $664 million for the three months ended March 31, 2025, compared to $399 million in 2024[249] Net Income and EBITDA - Consolidated Net Income for the three months ended March 31, 2025, was $4,983 million, compared to $4,722 million in 2024[191] - Consolidated EBITDA rose to $12,682 million for the three months ended March 31, 2025, from $12,155 million in 2024[191] - Consolidated Adjusted EBITDA increased to $12,555 million in Q1 2025, compared to $12,072 million in Q1 2024[191] Capital Expenditures and Cash Flow - Capital expenditures for the three months ended March 31, 2025, totaled $4.1 billion, with expectations for total capital expenditures in 2025 to be between $17.5 billion and $18.5 billion[162] - Net cash provided by operating activities increased by $698 million to $7,782 million for the three months ended March 31, 2025, compared to $7,084 million in 2024[254] - Free cash flow for the same period was $3,637 million, reflecting an increase of $929 million compared to $2,708 million in 2024[279] Debt and Interest - The average debt outstanding was $144.0 billion for the three months ended March 31, 2025, with total interest expense remaining relatively flat at $1.6 billion[183] - Total debt as of March 31, 2025, was $143.6 billion, with an effective interest rate of 5.1%[265] - Approximately 77% of Verizon's total debt portfolio consisted of fixed-rate indebtedness as of March 31, 2025[284] - A 100-basis-point change in interest rates affecting floating rate debt would result in a change in annual interest expense of approximately $342 million[284] Taxation - Provision for income taxes increased to $1,490 million for the three months ended March 31, 2025, up from $1,353 million in 2024, representing a 10.1% increase[184] - The effective income tax rate for the three months ended March 31, 2025, was 23.0%, up from 22.3% in the same period of 2024[184] Strategic Investments and Acquisitions - Verizon's investment in fiber networks is expected to increase in 2025, following the agreement to acquire Frontier Communications as part of its fiber expansion strategy[165] - Verizon entered into a license purchase agreement to acquire spectrum licenses from UScellular for total consideration of $1.0 billion[292] - Verizon's merger agreement to acquire Frontier Communications is structured with a per share merger consideration of $38.50, subject to regulatory approvals[293] Other Financial Metrics - Other income, net decreased by 38.9% to $121 million for the three months ended March 31, 2025, compared to $198 million in the same period of 2024[178] - Cost of wireless equipment increased by $201 million due to a shift to higher-priced equipment in the mix of wireless devices sold[175] - Unrecognized tax benefits remained stable at $2.6 billion as of March 31, 2025, consistent with December 31, 2024[185] - Interest and penalties related to unrecognized tax benefits were $649 million (after-tax) as of March 31, 2025, down from $684 million (after-tax) at December 31, 2024[185] Customer Metrics - Wireless retail connections are calculated by adding total retail postpaid and prepaid new connections and subtracting total disconnects[194] - Wireless retail postpaid connections increased by 943, reaching a total of 30,890, representing a 3.1% growth[235] - The churn rate for wireless retail postpaid was 1.13%, up from 1.03% in the previous year[232] - Total broadband connections increased by 10.2% to 10,244, with FWA broadband connections growing by 40.8% to 2,914[221] Renewable Energy Initiatives - As of March 31, 2025, Verizon had 28 renewable energy purchase agreements totaling approximately 3.7 gigawatts of anticipated renewable energy capacity[280]