Verizon Communications (NYSE:VZ) CEO Dan Schulman said the company is gaining momentum in its turnaround efforts through a customer-focused strategy, lower promotional spending, cost reductions and an expanding broadband and AI-infrastructure opportunity.
Speaking at the Goldman Sachs Communacopia + Technology Conference, Schulman said he entered the role with four priorities: improving customer retention and subscriber additions, changing Verizon’s culture, building a more efficient operating model and improving returns for investors.
Customer Experience and Subscriber Growth
Schulman said Verizon has invested billions of dollars in its end-to-end customer experience and recently reached an all-time high in consumer customer satisfaction. The company’s internal initiative, called “Every Customer Has a Name,” is intended to emphasize treating customers with respect throughout interactions ranging from retail stores and billing to customer-service calls.
He said churn, which had risen for three consecutive years before his arrival, is now declining year over year. Verizon’s churn was down by 5 basis points year over year in the quarter, according to Schulman, and its cost of retention has declined by double digits.
Schulman attributed prior churn pressure in part to price increases that were not matched by added value for consumers. Verizon halted further price increases upon his arrival, he said, and has sought to simplify its offerings and reduce inconsistencies between customer expectations, promotions and billing.
The company’s Simplicity plans, developed after six months of customer research and financial modeling, have helped drive stronger net additions, Schulman said. He said the plans target one- and two-line accounts and younger consumers, an area where Verizon had been underrepresented.
- Schulman said Simplicity plan additions are accretive to average revenue per account, or ARPA.
- He said the majority of Verizon’s net additions are now coming through Simplicity offerings.
- Customer migration from Verizon’s existing base to the plans has been below the company’s model assumptions, which Schulman said could provide upside.
- Cost of acquisition has fallen to a three-year low, while retention costs have also declined.
Schulman said Verizon expects to finish at the high end of its full-year guidance for 750,000 to 1 million postpaid phone net additions. He also said the company expects to report positive phone net accounts for the first time in at least three years.
Rather than pursuing subscriber growth through free lines or heavily subsidized handsets, Schulman said Verizon is emphasizing additions that generate revenue. “If we are going to win a customer, it has got to be real,” he said. “It has got to be because of our value proposition.”
Moving Away From Free Phones
Schulman said Verizon does not plan to offer “phones on us,” including around new device launches, arguing that wireless service pricing can be separated from device financing. Customers are keeping devices longer, he said, while Verizon can still provide financing alternatives or let customers bring their own devices.
The CEO said the traditional carrier model of using handset subsidies to acquire and retain subscribers has become industry dogma but is not necessary for Verizon’s strategy. He said the company can compete with simpler mobile pricing and device optionality while remaining fiscally responsible.
Schulman said he expects ARPA to rise year over year in 2027 and indicated that growth could begin as soon as the fourth quarter. Verizon’s mobile and broadband service revenue growth has increased each quarter this year, he said, from 1.6% in the first quarter to an expected roughly 4% in the fourth quarter.
Verizon One, the company’s converged offering, is also supporting ARPA, according to Schulman. More than half of customers using the offer are upgrading to gigabit or faster service, he said.
Broadband, Satellite and AI Infrastructure
Schulman said Verizon added about 350,000 broadband subscribers in the prior quarter and is taking share in broadband. He described fixed wireless access and fiber as parts of a broader broadband offering, rather than as distinct products from the customer’s viewpoint.
Verizon has more fixed wireless capacity available for sale than ever, he said, and is experimenting with spectrum holdings from low-band through millimeter-wave frequencies. The company expects to pass at least 32 million homes with fiber this year and remains on track toward its medium-term target of 40 million to 50 million homes passed.
On satellite competition, Schulman said Verizon has seen “zero discernible impact” from low-Earth-orbit providers, including Starlink, on broadband growth. He characterized satellite as complementary to terrestrial networks, particularly in rural markets where building a Verizon network may not be economically viable.
He said satellite providers cannot compete efficiently in urban and suburban areas, which account for 95% to 98% of Verizon’s revenue, in his view. Schulman cited a comparison between Starlink’s $130 offering for 400-megabit home broadband and Verizon’s $70 offering combining 500-megabit broadband with mobile service.
Schulman also highlighted AI infrastructure as a potential new growth area. Verizon recently announced a more than $1 billion dark-fiber connectivity deal with Google, and Schulman said demand is growing for connections between data centers as computing needs expand.
He said Verizon’s network assets, including metro and long-haul fiber, position it to participate in that demand. The company also announced a deal with Corning intended to secure fiber supply for its builds. In addition, Schulman said Verizon is repurposing decommissioned, power-ready central offices for edge inference-computing applications, such as robotics, gaming, autonomous driving and remote surgery.
Schulman said Verizon expects noticeable revenue from those edge-computing opportunities to begin next year.
Looking ahead, he said Verizon expects to continue pursuing operational efficiencies in 2027 and 2028. The company cut nearly 13,000 jobs in his second month as CEO and expects to exit the year with more than $5 billion in annualized operating-expense savings, he said. Verizon has also targeted $4 billion in capital-expenditure savings.
“No company cost cut its way to greatness,” Schulman said, adding that savings are intended to support reinvestment and shareholder returns.
About Verizon Communications (NYSE:VZ)
Verizon Communications Inc is a telecommunications company that provides wireless communications, broadband, and related technology services. Its offerings include mobile voice and data plans, 5G connectivity, fixed wireless access, fiber-optic internet through Verizon Fios, home services, and connected-device solutions.
Through Verizon Business, the company serves enterprises, government agencies, and other organizations with communications networks, managed connectivity, cybersecurity, cloud and edge-computing services, unified communications, and Internet of Things solutions.
