Verizon beats Q2 adjusted EPS estimates, raises forecast

Overview

• US telecom operator's Q2 adjusted EPS rose 6.6% yr/yr, beating analyst expectations

• Q2 total operating revenue fell 0.7% yr/yr due to lower equipment revenue

• Company raised full-year guidance and expanded share buyback target to up to $4.5 bln

Outlook

• Verizon raises 2026 mobility and broadband service revenue growth forecast to 2.5-3.0%

• Company expects adjusted EPS for 2026 of $4.99-$5.04, up 6-7% year-over-year

• Verizon forecasts 2026 free cash flow growth of 9-10% year-over-year

Result Drivers

• EQUIPMENT REVENUE DECLINE - Co said total operating revenue fell due to a nearly 20% drop in equipment revenue, mainly from lower upgrade volumes and reduced device subsidies

• SUBSCRIBER GROWTH - Co reported strong postpaid phone and broadband net additions, citing new plans, converged offerings, and a loyalty program as drivers

• SPECIAL ITEMS IMPACT - Net income declined due to $1.8 bln in pre-tax special items, including a loss on disposition of business, asset rationalization, and severance charges

Company press release: ID:nGNX7MDV5V

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 11 "strong buy" or "buy", 17 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the integrated telecommunications services peer group is "buy"

• Wall Street's median 12-month price target for Verizon Communications Inc is $50.00, about 14.1% above its July 23 closing price of $43.82

• The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 10 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)