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Verizon’s Third Quarter Revenue Falls Short as Device Upgrades Slow
Verizon's third-quarter results showed mixed performance with revenue missing estimates due to weak wireless equipment sales.
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Verizon Communications (NYSE: VZ) reported mixed third-quarter results Tuesday, with revenue missing analyst expectations due to declining wireless equipment sales, despite showing growth in its mobility customer base. The telecommunications giant’s stock fell nearly 4% in pre-market trading as investors digested the impact of a $1.7 billion severance charge that weighed on quarterly profits.
Verizon Fails to Meet Revenue Expectations in Third Quarter, Stock Dips in Premarket
The New York-based carrier reported total revenue of $33.3 billion for the quarter, alongside net income of $3.4 billion. Despite the revenue shortfall, driven primarily by fewer device upgrades, Verizon maintained its industry leadership position and reaffirmed its annual guidance.
Verizon shares dropped $1.72 to $41.98 in pre-market trading, following a previous regular session decline of 0.66%. Despite recent pressure, the stock has demonstrated strong performance in 2024, posting a year-to-date return of 23.64%, outpacing the S&P 500’s 22.73% gain.
The company’s one-year return of 47.65% also exceeded the broader market’s 38.58% advance, though its longer-term performance has lagged, with negative returns over three- and five-year periods.
Wall Street Maintains Positive Outlook on Verizon
Wall Street maintains a generally positive outlook on Verizon, with both Raymond James and Oppenheimer rating the stock as “Outperform,” while RBC Capital takes a more neutral “Sector Perform” stance. Analyst price targets range from $37.00 to $56.00, reflecting diverse views on the company’s growth prospects.
Trading at a forward price-to-earnings ratio of 9.28 and trailing P/E of 16.43, Verizon offers earnings per share of $2.66. The company’s trailing twelve-month revenue stands at $134.24 billion, highlighting its significant presence in the telecommunications sector despite recent challenges in equipment sales.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
