We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
VZ Rides on Healthy Traction in the Consumer Segment: Will it Persist?
Read MoreHide Full Article
Key Takeaways
VZ ended Q1 2025 with 115.1M wireless retail connections and 2.7% year-over-year service revenue growth.
A 0.9% postpaid phone churn and tailored unlimited plans reflect VZ's customer-focused strategy.
C-Band spectrum, AI tools and a 3-year price lock are boosting engagement and network differentiation.
Verizon Communications Inc.'s (VZ - Free Report) business has been gaining solid traction in the Consumer segment, backed by some major growth drivers. As of first-quarter 2025, the company’s wireless retail connections were 115.1 million, with wireless retail postpaid connections being 94.9 million. Core prepaid connections were 19 million. Service revenues improved to $20.8 billion, up 2.7% year over year, while equipment revenues were $4.5 billion. A retail postpaid phone churn of 0.9% indicates healthy customer retention. The company’s wireless retail postpaid ARPA was $146.46 at the end of the first quarter, up 3.6% year over year.
It is steadily building the entire network infrastructure and ecosystem to provide the most amazing 5G experience to customers. The company has witnessed increased adoption of 5G devices and premium unlimited plans. Verizon’s customer segmentation strategy, which categorizes different client groups, helps it deliver tailored solutions to different sectors. Such personalized offerings help in client retention, drive average revenue per account growth.
VZ’s effective customer-focused strategy, combined with a strong 5G network, is a major tailwind. Its three-year price lock guarantee will ensure the core monthly plan price for calling, data and texting will not change in the next three-year period, excluding taxes, fees and perks. The company also introduced cutting-edge AI-native features to boost customer service. Such initiatives are driving customer engagement. Moreover, the company’s C-Band spectrum offers greater coverage for 5G networks and greater speeds than on low-band spectrum and paves the way to provide differentiated service of 5G Ultra-Wideband to millions of customers.
Steady growth in wireless equipment revenues is expected to drive improvement in this segment. Per our estimate, the company is expected to record $20.93 billion in revenues in 2025 from wireless equipment sales, indicating healthy 6.8% year-over-year growth. Per our estimate, wireless retail postpaid ARPA is projected to reach $151.49, indicating 9.6% year-over-year growth.
How Are Competitors Faring?
Verizon operates in a highly competitive and saturated U.S. wireless market. It faces significant competition from T-Mobile, US, Inc. (TMUS - Free Report) and AT&T, Inc. (T - Free Report) . T-Mobile continues to boast a leadership position in the 5G market. Its Ultra Capacity 5G delivers superfast speeds, powering 5G smartphones and enabling innovators to deliver transformational 5G experiences. During the first quarter, T-Mobile’s postpaid phone churn rate was 0.91%.
AT&T is investing in key areas of 5G and fiber and adjusting its business according to the evolving market scenario to fuel long-term growth. With a customer-centric business model, AT&T is witnessing healthy momentum in its postpaid wireless business with a lower churn rate and increased adoption of higher-tier unlimited plans. The company reported a postpaid churn of 0.83% in the first quarter of 2025.
VZ’s Price Performance, Valuation and Estimates
Verizon has gained 4.8% over the past year compared with the Wireless National industry’s growth of 26.6%.
Image Source: Zacks Investment Research
Going by the price/earnings ratio, the company’s shares currently trade at 9.06 forward earnings, down from 13.57 for the industry but above the stock’s mean of 8.98. It carries a Value Score of A.
Image Source: Zacks Investment Research
Earnings estimates for 2025 have remained unchanged at $4.69 over the past 60 days, while the same for 2026 has improved 1.23% at $4.92.
Image: Bigstock
VZ Rides on Healthy Traction in the Consumer Segment: Will it Persist?
Key Takeaways
Verizon Communications Inc.'s (VZ - Free Report) business has been gaining solid traction in the Consumer segment, backed by some major growth drivers. As of first-quarter 2025, the company’s wireless retail connections were 115.1 million, with wireless retail postpaid connections being 94.9 million. Core prepaid connections were 19 million. Service revenues improved to $20.8 billion, up 2.7% year over year, while equipment revenues were $4.5 billion. A retail postpaid phone churn of 0.9% indicates healthy customer retention. The company’s wireless retail postpaid ARPA was $146.46 at the end of the first quarter, up 3.6% year over year.
It is steadily building the entire network infrastructure and ecosystem to provide the most amazing 5G experience to customers. The company has witnessed increased adoption of 5G devices and premium unlimited plans. Verizon’s customer segmentation strategy, which categorizes different client groups, helps it deliver tailored solutions to different sectors. Such personalized offerings help in client retention, drive average revenue per account growth.
VZ’s effective customer-focused strategy, combined with a strong 5G network, is a major tailwind. Its three-year price lock guarantee will ensure the core monthly plan price for calling, data and texting will not change in the next three-year period, excluding taxes, fees and perks. The company also introduced cutting-edge AI-native features to boost customer service. Such initiatives are driving customer engagement. Moreover, the company’s C-Band spectrum offers greater coverage for 5G networks and greater speeds than on low-band spectrum and paves the way to provide differentiated service of 5G Ultra-Wideband to millions of customers.
Steady growth in wireless equipment revenues is expected to drive improvement in this segment. Per our estimate, the company is expected to record $20.93 billion in revenues in 2025 from wireless equipment sales, indicating healthy 6.8% year-over-year growth. Per our estimate, wireless retail postpaid ARPA is projected to reach $151.49, indicating 9.6% year-over-year growth.
How Are Competitors Faring?
Verizon operates in a highly competitive and saturated U.S. wireless market. It faces significant competition from T-Mobile, US, Inc. (TMUS - Free Report) and AT&T, Inc. (T - Free Report) . T-Mobile continues to boast a leadership position in the 5G market. Its Ultra Capacity 5G delivers superfast speeds, powering 5G smartphones and enabling innovators to deliver transformational 5G experiences. During the first quarter, T-Mobile’s postpaid phone churn rate was 0.91%.
AT&T is investing in key areas of 5G and fiber and adjusting its business according to the evolving market scenario to fuel long-term growth. With a customer-centric business model, AT&T is witnessing healthy momentum in its postpaid wireless business with a lower churn rate and increased adoption of higher-tier unlimited plans. The company reported a postpaid churn of 0.83% in the first quarter of 2025.
VZ’s Price Performance, Valuation and Estimates
Verizon has gained 4.8% over the past year compared with the Wireless National industry’s growth of 26.6%.
Image Source: Zacks Investment Research
Going by the price/earnings ratio, the company’s shares currently trade at 9.06 forward earnings, down from 13.57 for the industry but above the stock’s mean of 8.98. It carries a Value Score of A.
Image Source: Zacks Investment Research
Earnings estimates for 2025 have remained unchanged at $4.69 over the past 60 days, while the same for 2026 has improved 1.23% at $4.92.
Image Source: Zacks Investment Research
Verizon currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.