Verizon Communications Inc at New Street Research BCG Connectivity Conference Summary

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

Question: Jonathan Chaplin - New Street Research - Analyst : <_ALACRA_META_ABSTRACT>So to kick things off, I'd love to get your perspectives on what's going on with mobile growth in the first quarter. It looks like all three of the big carriers have had a difficult January, which suggests to us that the that the market overall might be growing at a slower rate than expected. I think you've characterized the weaker than expected trends and rise in the first quarter is more of a competition than a market issue. I'd love to sort of kick off there.

Question: Jonathan Chaplin - New Street Research - Analyst : But Frank, don't you think the unusually tough promotions from T-Mobile and AT&T are response to a tough market environment, that they're riding harder to get their -- what they're looking to get out of a shrinking pool?

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. I'm sort of wondering whether that's the driver just because I felt like in 2024, we had a fairly rational competitive environment. This market is always competitive, but it seemed like the three national carriers were behaving in a sort of a competitive fashion that would lead to good returns for the industry. ARPU is growing, margin is expanding. And it seems like there's been a bit of a shift in competitive intensity at the beginning of the year.

Question: Jonathan Chaplin - New Street Research - Analyst : Yeah. And the wireless revenue growth is very much in your control because you're -- you've got a lot of influence through what you do with pricing and ARPU. On the subscriber front, though, given that we're starting off with net adds for the first quarter, the likely worse than last year, what gives you confidence that net adds for the full year are going to be better? What's going to change in the -- over the course of the next three quarters? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 26, 2025 / 12:30PM, VZ.N - Verizon Communications Inc at New Street Research BCG Connectivity Conference

Question: Jonathan Chaplin - New Street Research - Analyst : By the way, you should know that myPlan has been pretty transformative to Verizon's operating trends in 2024, and it was Frank's invention. He's behind the myPlan initiative as well as all of the partnerships that Verizon signed up over the course of the last four or five years that feed into myPlan.

Question: Jonathan Chaplin - New Street Research - Analyst : So Frank, going back to the two drivers of improving subscriber trends over the course of the next three quarters, the churn reduction

Question: Jonathan Chaplin - New Street Research - Analyst : Yeah. And so what drives the acceleration in gross adds for the rest of the 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. MARCH 26, 2025 / 12:30PM, VZ.N - Verizon Communications Inc at New Street Research BCG Connectivity Conference

Question: Jonathan Chaplin - New Street Research - Analyst : Touch on the trade-offs between driving that recovery in growth in subscriber trends and EBITDA. You've guided to I think 3% EBITDA growth for the year as well. Is that at risk as you sort of reinvest in lower churn and higher gross adds?

Question: Jonathan Chaplin - New Street Research - Analyst : So I want to come back to ARPA growth in a second. But before I do, just going back to the 8 million to 8.5 million subscriber adds that you expect for the industry this year. We learned at the end of last year that immigration was driving almost all of the population growth in the US, and that immigration has been running at like 3 times the normal rate. And it seems clear that it's going to come down starting this year over the course of the next four years. How does that impact mobile subscriber growth for the industry? And given that sort of backdrop, give us some more insights into your confidence in 8 million to 8.5 million. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 26, 2025 / 12:30PM, VZ.N - Verizon Communications Inc at New Street Research BCG Connectivity Conference

Question: Jonathan Chaplin - New Street Research - Analyst : And on prepaid, you're going back to growth this year, does that mean subscriber growth specifically?

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. And subscriber growth with or without SafeLink?

Question: Jonathan Chaplin - New Street Research - Analyst : And SafeLink, does it start to stabilize this year now that ACP is behind us?

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. And so moving to ARPU or ARPA, it's clearly a critical driver of revenue and EBITDA growth for Verizon. Is there -- it's been growing at what I think it was sort of an above-inflation rate. Is there a limit to where ARPA can or ARPU can go in the context of sort of household spending or some other metric? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 26, 2025 / 12:30PM, VZ.N - Verizon Communications Inc at New Street Research BCG Connectivity Conference

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. So the growth that comes from adding additional services to existing accounts. I totally get it. I guess it would be a mistake to look at sort of telecom revenues as a percentage of household disposable income. We've got to look at the full bundle of what household spend in content and broadband because you're providing savings there. But what about the sort of the relationship between wireless pricing and churn. I think the sort of key source of differentiation for Verizon has been network reliability. Your pricing is above where T-Mobile is just on the sort of the mobile piece of the product. Is your network better enough to support that pricing gap? And can the gap continue to expand? Do you need them to grow pricing in order for you to grow pricing?

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. Frank, I think you've lost earpiece, we should put it on for the guys that are on the webcast. So shifting gears a little bit to the C-band and what that enables in terms of fixed wireless access, which is an important revenue driver for you as well. Can you give us a sense of how many households can get fixed wireless access over C-band today and how quickly that's changing? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 26, 2025 / 12:30PM, VZ.N - Verizon Communications Inc at New Street Research BCG Connectivity Conference

Question: Jonathan Chaplin - New Street Research - Analyst : So that's really interesting. I thought that Hans said he expected fixed wireless access adds to slow a little bit in the first half of the year until your MDU product came in into effect later in the year. You basically haven't seen that slowdown in 1Q.

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. And give us a little bit more context on the MDU product. What's the addressable market for that ultimately? And how quickly can you open up that addressable market?

Question: Jonathan Chaplin - New Street Research - Analyst : So one of the most fascinating things that came out of the broadband update that you guys gave last year for me was that you're starting to sell fixed wireless access markets where you also have fiber. Does that suggest that there's market segmentation. There's a portion of the market that is interested in the fixed wireless product and a separate portion of the market that's interested in fiber?

Question: Jonathan Chaplin - New Street Research - Analyst : And where the other half of the fixed wireless access net adds coming from? Is that market expansion?

Question: Jonathan Chaplin - New Street Research - Analyst : Yeah. Got it. And so that is a really important insight, although technically fixed wireless access is offered in markets where you've got fiber based on how you manage the sales channel. If fiber is available in that market. That's what the customers going to see.

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. Okay. So give us some more insights into the strategic imperative behind the Frontier acquisition. Was this driven by the fact that fiber is just a good asset that generates good returns? Is it that you get the bundling and market share benefits? Or is there a network-driven imperative behind it?

Question: Jonathan Chaplin - New Street Research - Analyst : Nominal price. Got it. The bit of sort of drilling in a little bit deeper, the strategic imperative behind the benefits that you just listed. Is it the case that you're going to need a fiber broadband asset to compete effectively in mobile in the future?

Question: Jonathan Chaplin - New Street Research - Analyst : Yes. But what I'm wondering is, so you'll be able to offer a broadband product to most -- the vast majority of households in the US with one of these products or the other. But I'm wondering if fiber, in particular, gives you an advantage that fixed wireless doesn't on the network side. I'm sort of thinking forward to a future where we've burned through all of the spectrum below 6 gigahertz and we need to densify networks significantly, like by orders of magnitude in order to meet demand. And that fiber at that point becomes a really critical strategic asset, the more you have, the sort of the better your margins are?

Question: Jonathan Chaplin - New Street Research - Analyst : And in terms of that 1 million a year that you mentioned that you're going to deploy at after the close of the deal, why isn't that faster? When I look at your peers, they're sort of deploying it 2 to 3 times that pace.

Question: Jonathan Chaplin - New Street Research - Analyst : Got it. Would it make -- so the -- what the advantage is that AT&T and T-Mobile have sort of structured for themselves as they're doing a lot of the investment off balance sheet through JVs, which allows them to continue buying back shares and accelerating dividends. Does that sort of a structure makes sense for you, Frank?

Question: Jonathan Chaplin - New Street Research - Analyst : We saw a story on Bloomberg yesterday on AT&T potentially buying Lumen's fiber assets. I presume if there's a transaction that you guys would have looked at those assets. Can you comment at all on why those were or weren't attractive to you?

Question: Jonathan Chaplin - New Street Research - Analyst : Fair enough. We had to try. So can you give us a perspective on what you think the sort of the end state for the market looks like in terms of the three national carriers? And how much fiber will be sitting underneath those three mobile assets in sort of five years-plus from now?

Question: Jonathan Chaplin - New Street Research - Analyst : Yeah, Frank, we're out of time, but I do want to pick your brain very quickly on direct to device. Why is AST the right partner for you? How big is this sort of opportunity for Verizon? How do you think about the offers that T-Mobile has put on the table for your customers in terms of like a $20 price point? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 26, 2025 / 12:30PM, VZ.N - Verizon Communications Inc at New Street Research BCG Connectivity Conference

Question: Jonathan Chaplin - New Street Research - Analyst : Great. Frank, we really appreciate you being here today and sharing your insights with us. Thank you very much.