Verizon has issued a modest improvement in its full-year outlook, after a better-than-expected performance in Q3. The company now expects annual adjusted EPS flat to 2 percent higher, compared to its previous guidance for an up to 2 percent fall. This follows stable adjusted EPS of USD 1.25 in Q3 and a return to wireless service revenue growth of 0.4 percent as stores re-opened during the quarter. Wireless service revenues are expected to strengthen to at least 2 percent growth in Q4, supported by new device launches like the latest iPhones.
CEO Hans Vestberg said the business remained resilient despite the challenges brought on the Covid-19 pandemic and reduced activity. Total revenues were still down 4.1 percent year-on-year to USD 31.5 billion, compared to a 5.1 percent fall in Q2. Consumer revenue was down 4.3 percent to USD 21.7 billion in Q3, business revenue dropped 1.7 percent to USD 7.7 billion, and Verizon Media revenues were 7.4 percent lower at USD 1.7 billion. Reported EPS fell to USD 1.05 from USD 1.25 a year ago.
Customer growth remained positive, with especially strong growth in Fios broadband customers with 144,000 net additions, the best performance since the end of 2014. Verizon also added 136,000 consumer postpaid subscribers, including 142,000 phone net additions, and 417,000 business postpaid customers, including 141,000 with phones.
Year-to-date cash flow from operations totaled USD 32.5 billion, an increase of USD 5.7 billion year over year. This was helped by a non-recurring tax item in Q2, improvements in working capital primarily due to lower volumes, and severance payments made last year.
Year-to-date capital expenditures reached USD 14.2 billion, and Verizon said annual spending is likely to be at the high end of its guidance range of USD 17.5-18.5 billion. Capital expenditure is going to 4G upgrades, 5G expansion, the upgrade to its Intelligent Edge Network architecture, and the deployment of fibre in more than 60 markets.
