Strong wireless service revenue growth highlights Verizon's 4Q and 2022 results
24 Janvier 2023 - 01:00PM
Verizon Communications Inc. (NYSE, Nasdaq: VZ) closed 2022
with fourth-quarter results marked by wireless service revenue
growth and the highest total wireless retail postpaid net
additions3 in seven years.
"We delivered on the operational expectations and financial
targets that we set in the second half of 2022," said Verizon
Chairman and CEO Hans Vestberg. “We are rapidly building out our
C-Band spectrum with the most aggressive network deployment in our
company's history and are well positioned to improve and accelerate
our performance. Wireless mobility and nationwide broadband will be
two of the most significant contributors to our growth for the next
For fourth-quarter 2022, Verizon reported EPS of $1.56, compared
with $1.11 in fourth-quarter 2021. On an adjusted basis1, excluding
special items, EPS was $1.19 in fourth-quarter 2022, compared with
adjusted EPS1 of $1.33 in fourth-quarter 20212.
Fourth-quarter 2022 earnings included a pre-tax net gain from
special items of approximately $2.1 billion. This included a net
pre-tax benefit of approximately $2.5 billion related to a
mark-to-market adjustment for pension and OPEB (other
post-employment benefits) liabilities, a $304 million charge
related to severance and the impacts of amortization of intangible
assets related to TracFone and other acquisitions of $115
For full-year 2022, Verizon reported $5.06 in EPS, compared with
$5.32 for full-year 2021. On an adjusted basis1, excluding special
items, 2022 EPS was $5.18, compared with $5.50 for 20212.
- Total consolidated operating revenue in fourth-quarter 2022 of
$35.3 billion, up 3.5 percent from fourth-quarter 2021. Revenue
growth was driven by service and other revenue and equipment
revenue. Full-year 2022 consolidated operating revenue was $136.8
billion, up 2.4 percent year over year.
- Total wireless service revenue5 in fourth-quarter 2022
increased 5.9 percent year over year. This increase was driven by
unlimited plan migrations, the company's highest total wireless
retail postpaid net additions in seven years, pricing actions that
were implemented beginning in June 2022 and a full quarter
contribution from TracFone. Full-year 2022 wireless service
revenue5 increased 8.6 percent year over year. The results for both
fourth-quarter 2021 and full-year 2021 included a partial
contribution from the acquisition of TracFone, which was completed
in November 2021.
- Net income of $6.7 billion, an increase of 41.4 percent
compared to fourth-quarter 2021, and adjusted EBITDA1 of $11.7
billion, a decline of 0.2 percent year over year.
- Cash flow from operations totaled $37.1 billion in 2022, a
decrease from $39.5 billion in 2021. This decline was primarily
driven by higher device payment receivables as the company's device
payment portfolio increased by approximately $5 billion during
- Full-year 2022 capital expenditures were $23.1 billion,
including C-Band spending of $6.2 billion.
- The company ended 2022 with free cash flow1 of $14.1 billion, a
decrease from $19.3 billion at year-end 2021.
- Verizon's unsecured debt as of the end of fourth-quarter 2022
decreased by $766 million sequentially to $130.6 billion. The
company's net unsecured debt1 balance decreased sequentially by
$1.3 billion to $128.0 billion, and its net unsecured debt to
adjusted EBITDA ratio1 at quarter-end was approximately 2.7
Verizon Consumer results
- Total Verizon Consumer revenue was $26.8 billion, an increase
of 4.2 percent year over year, driven by wireless service revenue.
For full-year 2022, total Verizon Consumer revenue was $103.5
billion, an increase of 8.6 percent from full-year 2021.
- Wireless service revenue increased 6.1 percent year over year.
For full-year 2022, total Consumer wireless service revenue was
$61.5 billion, an increase of 9.6 percent from full-year 2021. This
increase was driven by premium adoption, overall postpaid
connection growth, pricing actions that were implemented beginning
in June 2022 and the inclusion of TracFone results.
- Consumer wireless retail postpaid churn3 was 1.06 percent in
fourth-quarter 2022, and wireless retail postpaid phone churn3 was
- In fourth-quarter 2022, Consumer reported 41,000 wireless
retail postpaid phone net additions3. Consumer ended fourth-quarter
2022 with 59 percent of its postpaid wireless phone customers
having 5G-capable devices.
- Consumer reported 175,000 wireless retail prepaid net losses3
in fourth-quarter 2022.
- Consumer reported 262,000 fixed wireless net additions and
56,000 Fios Internet net additions in fourth-quarter 2022. For
full-year 2022, Consumer reported 776,000 fixed wireless net
additions and 199,000 Fios Internet net additions. Consumer Fios
revenue was $2.9 billion in fourth-quarter 2022, flat year over
year. Full-year 2022 Consumer Fios revenue was $11.6 billion, an
increase of 0.6 percent from full-year 2021.
- In fourth-quarter 2022, Consumer operating income was $7.0
billion, a decrease of 4.4 percent year over year, and segment
operating income margin was 26.3 percent, a decrease from 28.6
percent in fourth-quarter 2021. Full-year 2022 Consumer operating
income was $28.8 billion and segment operating income margin was
27.9 percent, a decrease from 31.4 percent in full-year 2021.
Segment EBITDA1 in fourth-quarter 2022 was $10.1 billion, a
decrease of 2.0 percent year over year. This decline was due to
higher promotional expense related to device subsidies. Segment
EBITDA margin1 was 37.9 percent, a decrease from 40.3 percent in
fourth-quarter 2021. For the full year, segment EBITDA margin1 was
40.2 percent in 2022, a decrease from 43.7 percent in 2021.
Verizon Business results
- Total Verizon Business revenue was
$7.9 billion in fourth-quarter 2022, an increase of 1.2 percent
year over year. Growth was primarily driven by Small and Medium
Business mobility, partially offset by wireline declines. For
full-year 2022, total Verizon Business revenue was
$31.1 billion, flat year over year, as strong wireless
performance was offset by wireline declines.
- Business wireless service revenue
was $3.3 billion, an increase of 4.7 percent year over year. This
growth was driven predominantly by the continued momentum in adding
more customers onto the platform. Full-year 2022 Business wireless
service revenue was $12.8 billion, an increase of 3.9 percent
compared to full-year 2021.
- Business reported 455,000 wireless
retail postpaid net additions3 in fourth-quarter 2022, including
176,000 postpaid phone net additions3. This was the sixth
consecutive quarter that Business reported more than 150,000
postpaid phone net additions.
- Business wireless retail postpaid
churn3 was 1.38 percent in fourth-quarter 2022, and wireless retail
postpaid phone churn3 was 1.06 percent.
- Business reported 117,000 fixed
wireless net additions in fourth-quarter 2022.
- In fourth-quarter 2022, Verizon
Business operating income was $585 million, a decrease of 26.5
percent year over year, and segment operating income margin was 7.4
percent, a decrease from 10.2 percent in fourth-quarter 2021.
Full-year 2022 segment operating income was $2.6 billion and
segment operating income margin was 8.5 percent, compared with 11.1
percent in full-year 2021. Segment EBITDA1 was $1.7 billion in
fourth-quarter 2022, a decrease of 8.2 percent year over year,
which reflected higher subsidies due to increased activations and
sales-related expense, as well as declines in high margin wireline
revenues. Segment EBITDA margin1 was 21.3 percent in fourth-quarter
2022, a decrease from 23.5 percent in fourth-quarter 2021. For the
full year, segment EBITDA margin1 was 22.3 percent, a decrease from
24.2 percent in 2021.
Outlook and guidance
For 2023, Verizon expects the following:
- Total wireless service revenue
growth4 5 of 2.5 percent to 4.5 percent.
- Adjusted EBITDA1 of $47.0 billion
to $48.5 billion.
- Adjusted EPS1 of $4.55 to
- Adjusted effective income tax rate1
in the range of 22.5 percent to 24.0 percent.
- Capital spending in the range of
$18.25 billion to $19.25 billion, including the final approximately
$1.75 billion of the incremental $10 billion of C-Band-related
1Non-GAAP financial measure. See the accompanying schedules and
www.verizon.com/about/investors for reconciliations of non-GAAP
financial measures cited in this document to most directly
comparable financial measures under generally accepted accounting
2Adjusted EPS for the prior year period has been reclassified to
conform to current period presentation.
3At the end of the fourth quarter of 2022, Verizon fully
decommissioned its 3G network, as a result of which approximately
909,000 wireless retail postpaid connections (576,000 Consumer and
333,000 Business connections), including 392,000 wireless retail
postpaid phone connections (180,000 Consumer and 212,000 Business
connections), and 237,000 wireless retail prepaid connections were
disconnected from its network. The impact of the 3G network
shutdown has been excluded for purposes of calculating wireless
retail net additions and wireless churn for the respective
4Includes a benefit of approximately 190 basis points from the
reallocation from Other revenue to Wireless service revenue. This
results from a larger allocation of administrative and telco
recovery charges which partly recover network operating costs.
5Total wireless service revenue represents the sum of Consumer
and Business segments.
Verizon Communications Inc. (NYSE, Nasdaq: VZ) was formed on
June 30, 2000 and is one of the world’s leading providers of
technology and communications services. Headquartered in New York
City and with a presence around the world, Verizon generated
revenues of $136.8 billion in 2022. The company offers data, video
and voice services and solutions on its award-winning networks and
platforms, delivering on customers’ demand for mobility, reliable
network connectivity, security and control.
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changes in tax laws or treaties, or in their interpretation; and
changes in accounting assumptions that regulatory agencies,
including the SEC, may require or that result from changes in the
accounting rules or their application, which could result in an
impact on earnings.
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