Good morning. Verizon sees AI not just as a tool to boost efficiency but as a potential new revenue engine.I recently spoke with Verizon CFO Tony Skiadas, who discussed how the company is working to repurpose parts of its wireline network to support AI workloads and what that could mean for Verizon’s future.Reimagining wireline for AISkiadas explained that Verizon (No. 30 on the Fortune 500) is testing ways to leverage its existing central offices—facilities largely freed up as copper networks are replaced ...

Core Perspective - Verizon celebrates 25 years of innovation and reliability, focusing on future technological advancements and community empowerment [1][2] Group 1: Technological Innovation - Verizon has a history of pioneering technology, including the first 5G mobile network and fiber to the home with Fios, maintaining a leadership position in the industry [2] - The company generated revenues of $134.8 billion in 2024, showcasing its strong market presence and commitment to innovation [10] Group 2: Community Commitment - Verizon has provided disaster resiliency support during crises, ensuring connectivity for families and first responders [3] - The company has trained nearly 9 million students in digital skills through its Verizon Innovative Learning program, addressing the digital divide [4] Group 3: Support for Small Businesses - The Small Business Digital Ready program has supported over 500,000 businesses by offering free courses and resources [5] - Verizon plans to invest $5 billion with small business suppliers over the next five years to foster growth and collaboration [6] Group 4: Future Vision - The acquisition of Frontier Communications aims to expand Verizon's fiber footprint, enhancing connectivity for millions [7] - Verizon is implementing AI-powered customer service enhancements, including a dedicated "Customer Champion" team and 24/7 live chat support [8][9]

Core Insights - Telecom giants AT&T and Verizon are not traditional leaders in the AI revolution, but their connectivity services are essential for the data-intensive AI ecosystem [1] - Both companies are leveraging their 5G and fiber optic networks to meet the increasing demand for edge computing, resulting in stock price increases of 19% for AT&T and 13% for Verizon year to date [2] AT&T Overview - AT&T has seen a significant stock market recovery, with shares up 58% over the past year, attributed to a focus on core telecom strengths and exiting media ventures [4] - For the year ending December 31, 2024, AT&T's mobility segment revenue increased by 3.3%, with consumer broadband revenue rising by 7.2% due to fiber network expansion [5] - AI integration is contributing to AT&T's success, enhancing automation and capturing demand for middle mile infrastructure [6] - AT&T projects further growth for 2025, with a dividend yield of 4.1% and a potential dividend hike, alongside a new $10 billion share buyback program [7][8] Verizon Overview - Verizon, while experiencing a recent rally, has advantages such as larger total revenue and stronger free cash flow for 2024, making it a potentially better investment [9] - Verizon shares trade at a forward P/E ratio of around 10, offering better value compared to AT&T's 13, along with a higher dividend yield of 5.8% [10] - Verizon has a more defined AI strategy with its Verizon AI Connect solution and partnerships with tech leaders like Alphabet, Meta Platforms, and Nvidia [11][12] Investment Recommendation - Both AT&T and Verizon are positioned to benefit from long-term telecommunications opportunities, but Verizon is viewed as the better investment choice for 2025 due to its current valuation and growth potential [13][14]