Verizon Communications has performed well this year, with the company's stock returning about 24% over the past 12 months. In contrast, the S&P 500 has grown by about 19%. Verizon's stock is currently priced around $51, at its highest level in the past year. This is a real return, but the revenue needed to support it has not yet been achieved.
Verizon's Challenges in Attracting Customers
In mid-June, the company made changes to its pricing policies. Verizon eliminated activation and upgrade fees and introduced a $45 simplicity plan that separates phone subsidies from service pricing. Additionally, mobile and internet services were bundled under a $70 bill called Verizon One.
Read more: A woman in Utah receives $225,000 tax-free from her ex-husband
The company's management has stated that the customer acquisition trend has improved prior to implementing these changes. The churn rate for mobile customers decreased by 84 basis points in the second financial quarter of 2026, and Verizon attracted 184,000 new phone lines and 348,000 new internet subscribers. Advertising costs for customer acquisition have also decreased by about 15% year-over-year.
Revenue Expectations and Existing Risks
However, a decline in equipment revenue of approximately 20% indicates the challenges facing Verizon. The company's total revenue in the second financial quarter of 2026 decreased to $34.3 billion, which is 0.7% lower than last year.
Two factors could fill this revenue gap. Revenue from mobile and internet services grew by 2.8% in the second financial quarter of 2026 and is expected to reach 3% in the third financial quarter and 4% in the fourth financial quarter. Wireless service revenue, which constitutes the main income, decreased by 0.7% and is expected to achieve positive growth in the second half of the year.
The main risk for Verizon is that these changes in policies and pricing do not quickly convert into revenue. Currently, the company's revenue has only grown by 1.4% over the past 12 months and has shown a downward trend in the recent quarter. Meanwhile, Verizon's stock has decreased by 17% from its peak.
Read more: The Bank of Japan raises interest rates to the highest level in 31 years · Tropanion CEO, Margaret Tooth, sold $25,000 worth of company stock
