Verizon Communications Inc at JPMorgan Global Technology, Media and Communications Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Sebastiano Petti - JPMorgan - Analyst : So now we've got the important stuff is out of the way there, Hans, there's a lot going on at Verizon these days in terms of pending Frontier acquisition, evolving product solutions in the wireless, broadband, consumer and business and the brand refresh. So where are you spending most of your time these days? What are your biggest near-term priorities as you position Verizon for the next decade plus?

Question: Sebastiano Petti - JPMorgan - Analyst : Great. And in early April, you announced the third phase of the Verizon Consumer Group transformation, which is the three-year price lock. So a couple of things to touch on there. First, how does the Verizon guarantee value proposition stand out in the marketplace?

Question: Sebastiano Petti - JPMorgan - Analyst : Got it. And then I guess maybe thinking about why the price likewise is the right strategy as you think about the competitive backdrop in --

Question: Sebastiano Petti - JPMorgan - Analyst : All right. So sticking with the wireless for a moment here. While there's been a lot of focus on gross adds and switching you did talk about the double-digit growth in consumer in April, continuing -- Tony touched upon the performance continued to be strong at the time of the earnings call. Churn has been more elevated than we expected coming into the year. Part of that is market driven, but you also said somewhat idiosyncratic as it pertains to the price increase. So I guess, help us think about even before the three-year price lock that launch because that momentum had been improving within the business. I guess you had talked about stores, promos, some of that momentum and then now the price lock perhaps somewhat more additive. So how do

Question: Sebastiano Petti - JPMorgan - Analyst : Great. I think just --

Question: Sebastiano Petti - JPMorgan - Analyst : Yeah. Thank you. Yeah, checking a lot of boxes here. So as we think about -- I think that we can't -- we discussed this yesterday, but I think expectations for churn to get back to BAU levels --

Question: Sebastiano Petti - JPMorgan - Analyst : Yeah. And then I think just over time as well, I think said trying to return -- to be a leader in the industry in terms of churn. But I guess, how do you balance that against the focus you just touched upon in terms of service revenue? Because the three-year price lock, while you do have myPlan selling in some of these good guys from a benefit, you do also -- this industry has relied on price. So how do you balance those two? I guess, what gives you the confidence in churn improving in the back half and into next year against your maybe pricing strategy, taking a read on legacy plans and what have you?

Question: Sebastiano Petti - JPMorgan - Analyst : So adding it all up, we touched on gross add activity in the second quarter, your outlook on churn. But you do have guidance or expectations out there for --

Question: Sebastiano Petti - JPMorgan - Analyst : Yes, 2025 postpaid consumer postpaid phones ahead of 2024 level. But I guess --

Question: Sebastiano Petti - JPMorgan - Analyst : Okay. Well, there you go. Let me check the back. I guess just so -- but higher gross adds, higher churn, but you're still confidence in getting them. Got it. Okay. Now skipping to broadband, you have accelerated the fiber build pace in Fios to 650,000 expectation is that level in 2025. And you're running ahead of plan, I think you touched on, on the 1Q call. Why not go even faster? Is it a function of just lower returns in the Fios footprint versus what you think you can unlock in Frontier?

Question: Sebastiano Petti - JPMorgan - Analyst : As you think about those cost improvements and if the returns do make sense, pro forma for a Frontier, would you be willing to accelerate the build even if it means taking leverage higher or using your balance sheet to get there?

Question: Sebastiano Petti - JPMorgan - Analyst : Yes. Okay. So 1 million plus. All right. And so yes, you did also kind of touch on -- we also did kind of touch on again last night with the MDU launch live MDU/FWA launch. So you're live in 15 markets today and expected to roll that out over the year in both the consumer and business segments. I mean how meaningful of a contributor could this be? Coupled with the expanded C-band coverage, greater emphasis on converged bundles, could we see a reacceleration in total FWA adds as we maybe enter as we go into next year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 14, 2025 / 12:00PM, VZ.N - Verizon Communications Inc at JPMorgan Global Technology, Media and Communications Conference

Question: Sebastiano Petti - JPMorgan - Analyst : And the main, obviously, area of debate, I guess, within the ecosystem is just usage on FWA and taxing the network. Can you remind us what sort of more recent stats, I think, you guys have put out a what you're thinking about that?

Question: Sebastiano Petti - JPMorgan - Analyst : It's a great segue there to one of my favorite topics, private networks. On the 1Q call that you noted that the private network business continued to scale. I think you talked about a dozen deals were signed in the first quarter. I guess, how would you describe the demand from private networks today maybe versus last year when we were on this stage?

Question: Sebastiano Petti - JPMorgan - Analyst : And you're seeing lit and dark fiber healthy demand in both?

Question: Sebastiano Petti - JPMorgan - Analyst : Okay. So great. I mean, the network is the foundation of everything you guys offer, right? I think it's very core, very important to you. And you are deploying C-band, 80% to 90% of the plant site this year. You're also rolling out 5G advanced features. So I guess just maybe update us on the network road map and how you're thinking about the capabilities that additional C-band capacity, 5G advances, what opportunities could this potentially track for you in the coming years?

Question: Sebastiano Petti - JPMorgan - Analyst : So as we're thinking about -- after you get past the 8 million to 9 million, once you get there, not if you get there, once you get there, so there could be some success based, but do you think that the -- from an FWA long-term road map, do you think that the FWA, that core base is still sustainable long term? Or do you see usage or anything like that, that they might find a fixed broadband?

Question: Sebastiano Petti - JPMorgan - Analyst : Great. And so as we're wrapping up here, and so Verizon reported highest ever EBITDA in the first quarter of 2025, up 4% year-over-year. Also reiterated all your 2025 financial guidance despite declines in consumer confidence. We talked about some pressures in federal government as well as a fluid business environment. Obviously, a lot changes week to week. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 14, 2025 / 12:00PM, VZ.N - Verizon Communications Inc at JPMorgan Global Technology, Media and Communications Conference But at the same time, you are leaning in on volume growth, which we spent the majority of the conversation discussing here this morning. So I guess help us think about what underpins your confidence in achieving the full year EBITDA and free cash flow guidance. What are the top and bottom line levers to get there? Business EBITDA margins quite strong as well. And you have some other programs via the voluntary separation program, HCL Tech.

Question: Sebastiano Petti - JPMorgan - Analyst : Great. I think that's a great place to leave it. Hans, thank you so much for joining us today. It's great to see you.