Verizon’s Postpaid Subscribers Offer Bright Spot as Company Misses Q2 Revenue Estimates

Verizon Communications missed quarterly revenue estimates on Monday as more cost-conscious customers decided to hold on to their phones longer, overshadowing monthly billing subscriber growth.

Verizon reported second-quarter revenue of $32.8 billion, compared with analysts’ average estimate of $33.06 billion, according to LSEG data reported by Reuters.

The company saw a growth of 148,000 postpaid phone subscribers from April to June. Postpaid phone subscribers, billed monthly, are the highest-spending wireless subscribers. Reuters reported that they were above analysts’ average estimate of 127,870 additions, according to information provided by Visible Alpha. Verizon lost 68,000 subscribers in the prior quarter.

According to the news outlet, the company’s customizable myPlan program, which is “seeing strong adoption from customers,” helped Verizon gain those subscribers and compete more effectively with AT&T and T-Mobile in the U.S. telecom market.

Verizon Chairman and CEO Hans Vestberg said in an interview for CNBC’s Squawk Box program on Monday that the company’s overall revenue was lower than expected because “promotions and upgrades on phones are still down,” noting that customers generally get new phones every 36 months, whereas it used to be every year.

He added that about one-third of all Verizon’s customers now are part of myPlan, which was introduced in May 2023 and lets users pay just for what they need.

According to Reuters, analysts have said that while Verizon is hurting from people who aren’t currently upgrading their phones, which Vestberg said was due in part to better-made receivers, consumers could start reaching into their pockets for new devices once Apple releases new iPhones later this year. These new phones will be packed with artificial intelligence features.

Verizon saw second-quarter 391,000 total broadband net additions, ending the period with 11.5 million broadband subscribers, up 17.2% year over year.

The company also stated that it expects to meet full-year projections, with wireless service revenue to grow 2% to 3.5% over last year, according to Verizon. 

“We continue to build and expand on our strengths and successes with new products and services, and we are confident that this upward momentum will position us for future growth,” Vestberg said in the company’s Q2 earnings report.