5 Revealing Analyst Questions From Verizon's Q1 Earnings Call
Is now the time to buy VZ? Find out in our full research report (it's free).
Revenue: $33.49 billion vs analyst estimates of $33.33 billion (1.5% year-on-year growth, in line)
Adjusted EPS: $1.19 vs analyst estimates of $1.15 (3.6% beat)
Adjusted EBITDA: $12.56 billion vs analyst estimates of $12.34 billion (37.5% margin, 1.7% beat)
Operating Margin: 23.8%, up from 22.8% in the same quarter last year
Market Capitalization: $176.5 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
John Hodulik (UBS) asked about the impact of tariffs on equipment and handsets. CEO Hans Vestberg explained that tariff exposure is limited on capital spending, and any significant handset tariff increases would likely be passed to consumers rather than absorbed by Verizon.
Ben Swinburne (Morgan Stanley) questioned whether the improvement in gross additions was due to specific promotions or market share gains. Sowmyanarayan Sampath, Consumer Group CEO, attributed the momentum to the Verizon Value Guarantee offer, noting double-digit growth in April gross adds.
Jim Schneider (Goldman Sachs) inquired about changes in consumer behavior and the sustainability of business margins. Sampath reported continued demand for premium plans, while CFO Tony Skiadas highlighted structural cost improvements and stable payment trends.
Michael Rollins (Citi) asked about postpaid phone industry growth and the impact of immigration policy. Sampath stated that Verizon is performing well even as much of market growth is driven by prepaid-to-postpaid migration, a segment where Verizon participates primarily through partners.
Peter Supino (Wolfe Research) asked how the company's multi-year fixed wireless access expansion could pressure capital expenditures. Vestberg responded that the rollout is incorporated into existing plans and should not create additional pressure through 2028.
Looking ahead, the StockStory team will be monitoring (1) adoption and retention trends following the rollout of the three-year price lock and free phone guarantee; (2) progress on the integration and broadband expansion linked to the pending Frontier acquisition; and (3) continued improvements in prepaid and converged customer segments. Execution on operational efficiency and network investments will also play a critical role in shaping future performance.
Verizon currently trades at $41.94, down from $42.93 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it's free).
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