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VZ · VERIZON COMMUNICATIONS INC

36 filings

10-K

VZ 10-K Annual Reports

VERIZON COMMUNICATIONS INC - 36 annual reports

Filing record · 2016–202610-K1110-Q328-K201

2025
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2025
Verizon Communications Inc. reported solid performance for the fiscal year ended December 31, 2025, with consolidated operating revenues increasing by 2.5% to $138.19 billion. This growth was primarily driven by a robust 3.8% increase in the Consumer segment's revenue, reaching $106.8 billion, largely fueled by growth in wireless service and equipment revenue. The Business segment saw a slight 1.6% decrease in revenue to $29.1 billion, impacted by declines in its Enterprise and Public Sector, and Wholesale divisions, though offset by growth in the Business Markets and Other category. The company also highlighted its ongoing network evolution, including the continued deployment of 5G and fiber technologies, and the completion of strategic acquisitions in early 2026, namely Frontier Communications and Starry Group Holdings. These acquisitions are expected to enhance Verizon's broadband capabilities and expand its fiber footprint. Despite these strategic investments, Verizon maintained strong free cash flow of $20.1 billion for the year, demonstrating operational efficiency and financial discipline. Looking ahead, Verizon remains focused on its strategic growth areas of mobility and broadband, with planned capital expenditures between $16.0 billion and $16.5 billion for 2026. The company also reaffirmed its commitment to returning capital to shareholders, announcing a new $25 billion share repurchase program and a dividend increase, underscoring its confidence in future performance and shareholder value creation.
Feb 17, 2026
2024
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2024
Verizon Communications Inc. reported solid financial performance for the fiscal year ending December 31, 2024, demonstrating resilience and strategic execution across its key business segments. The Consumer segment continued to be the primary revenue driver, showing growth fueled by its expansive wireless network and increasing adoption of fixed wireless access (FWA) services. The Business segment, while facing some headwinds in legacy wireline services, showed growth in areas like Business Markets and Other, highlighting efforts to diversify its enterprise offerings. The company's strategic focus on network evolution, particularly the ongoing deployment and monetization of its 5G capabilities, remains a core pillar of its future growth strategy. Financially, Verizon managed its debt effectively, with a notable reduction in total debt year-over-year. Capital expenditures remained robust, primarily directed towards network enhancements and spectrum deployment, underscoring a commitment to maintaining its competitive network advantage. The company also continued its shareholder return programs, including dividend payments. Despite ongoing competitive pressures and macroeconomic factors, Verizon's diversified service portfolio and substantial network infrastructure position it to navigate the evolving telecommunications landscape.
Feb 12, 2025
2023
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2023
Verizon Communications Inc. reported its 2023 annual results, highlighting a strategic focus on network evolution and customer experience amidst intense industry competition. The company's consolidated operating revenues saw a slight decrease of 2.1% to $133.97 billion, primarily driven by lower wireless equipment revenues. While the Consumer segment remained the larger contributor to revenue at $101.6 billion, it experienced a 1.8% decline. The Business segment also saw a revenue decrease of 3.1% to $30.1 billion. A significant event during the year was a $5.8 billion goodwill impairment charge related to the Business segment, reflecting market pressures and revised financial projections. Despite revenue headwinds, Verizon continued its network investments, particularly in 5G and C-Band spectrum deployment, aiming to enhance future growth opportunities. The company generated strong free cash flow of $18.7 billion, an increase from the prior year, driven by operating improvements and reduced capital expenditures. Verizon also maintained its commitment to shareholders through dividends, increasing its quarterly payout for the seventeenth consecutive year. Looking ahead, the company anticipates capital expenditures to be in the range of $17.0 billion to $17.5 billion for 2024.
Feb 9, 2024
2022
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2022
Verizon Communications Inc. reported solid performance in its 2022 Annual Report, with consolidated operating revenues increasing by 2.4% to $136.8 billion. The Consumer segment was the primary revenue driver, showing an 8.6% increase to $103.5 billion, largely due to growth in service and wireless equipment revenues, bolstered by the TracFone acquisition. The Business segment revenue remained relatively flat at $31.1 billion, with growth in the Small and Medium Business sector offsetting declines in Global Enterprise, Public Sector, and Wholesale. Despite an inflationary environment that impacted operating expenses and increased interest expenses, Verizon demonstrated resilience. The company continued its significant investment in network modernization, particularly in its 5G deployment, including the expansion of C-Band spectrum. Capital expenditures reached $23.1 billion in 2022, a peak year driven by C-Band deployment. Free cash flow remained strong at $14.1 billion, reflecting the company's operational efficiency and prudent financial management. Verizon also continued its commitment to shareholders by increasing its quarterly dividend for the sixteenth consecutive year. Key risks highlighted include intense competition across all segments, the need for continued technological adaptation, and the potential impacts of economic conditions such as inflation on consumer spending and operating costs. The company also noted the ongoing costs and complexities associated with its 5G network buildout and spectrum acquisition. Overall, Verizon presented a stable financial picture with a clear strategy focused on network leadership and customer retention.
Feb 10, 2023
2021
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2021
Verizon Communications Inc. reported strong revenue growth in 2021, primarily driven by its Consumer segment, which saw a 7.6% increase in operating revenues to $95.3 billion. This growth was bolstered by increased service revenue from wireless and Fios internet, as well as a significant rise in wireless equipment sales, partly due to demand for 5G devices. The Business segment experienced modest revenue growth of 0.3%, reaching $31.0 billion, with Small and Medium Business revenues showing a notable increase of 5.8%. The company made significant strategic moves during the year, including the sale of its media business and the acquisition of TracFone Wireless, Inc. These actions are expected to reshape Verizon's business focus and customer base. Financially, Verizon saw a substantial increase in capital expenditures, largely driven by its ongoing 5G network deployment and C-Band spectrum acquisition, totaling $20.3 billion. Despite these investments, the company demonstrated solid financial health, with free cash flow remaining robust. Looking ahead, Verizon is focused on leveraging its network leadership, particularly its 5G capabilities, to drive future growth. The company aims to enhance customer relationships, expand its ecosystem of products and services, and maintain operational efficiencies. Investors will want to monitor the integration of TracFone, the continued rollout of 5G, and the company's ability to manage its significant debt load while continuing to return capital to shareholders through dividends.
Feb 11, 2022
2020
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2020
Verizon Communications Inc. reported consolidated revenues of $128.3 billion for the year ended December 31, 2020, a decrease of 2.7% compared to 2019, primarily impacted by the COVID-19 pandemic. The company's operations were affected by reduced customer activity, government-imposed restrictions, and a global economic slowdown. Despite these challenges, Verizon maintained a strong balance sheet with $22.2 billion in cash and cash equivalents at year-end. The company continued its strategic focus on network investments, particularly in 5G technology, and operational efficiency initiatives aimed at long-term value creation. Operationally, Verizon saw a decrease in both its Consumer and Business segments, with wireless equipment revenue declining significantly due to an elongated upgrade cycle and pandemic-related impacts. The company also experienced fluctuations in its media business. Verizon demonstrated resilience through various customer support measures during the pandemic, including waiving late fees and providing additional data. Looking ahead, Verizon remains committed to network leadership, customer experience enhancement, and shareholder returns through dividends and potential share repurchases, while navigating ongoing competitive pressures and technological advancements in the telecommunications industry.
Feb 25, 2021
2019
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2019
Verizon's FY2019 10-K shows a company whose top line grew modestly while its bottom line was dominated by one-time items. Consolidated revenue rose 0.8% to $131.9 billion, driven by Consumer (up 1.4% to $91.1 billion), while Business was roughly flat (down 0.3% to $31.4 billion) and Verizon Media continued to shrink (revenue of $7.5 billion, down 3.0%). Reported operating income jumped to $30.4 billion from $22.3 billion, but this comparison is distorted by 2018's $4.6 billion Media goodwill impairment and $2.2 billion of severance charges. Net income attributable to Verizon rose to $19.3 billion (diluted EPS $4.65) from $15.5 billion, helped by a roughly $2.2 billion non-recurring tax benefit from disposing of a minority preferred-stock interest in a foreign affiliate, partly offset by $3.6 billion of early debt redemption costs. The cash-flow and balance-sheet picture is more mixed. Operating cash flow was $35.7 billion and capital expenditures were $17.9 billion, leaving free cash flow of $17.8 billion against $10.0 billion of dividends. Total debt fell to about $111.5 billion, and management reported a 4.8% effective interest rate and no change in credit ratings. Verizon's use of asset-backed device-payment receivables financing grew, with $12.4 billion of ABS debt outstanding. Management guided 2020 capex to $17.0–18.0 billion and expects overall Business revenue growth, while a new $10 billion share buyback authorization (up to 100 million shares) was approved in February 2020. For investors, the key points are the underlying consumer wireless strength (postpaid phone net adds of 737 thousand, with rising ARPA), continued secular pressure in legacy wireline and Media, the heavy 5G investment cycle, and the large unfunded-benefit and debt obligations that constrain flexibility. Reported 2019 earnings should be read alongside the special items that inflated them.
Feb 21, 2020
2018
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2018
Verizon's 2018 Form 10-K (filed February 15, 2019) shows a company with stable core economics but a sharp swing in reported earnings. Consolidated operating revenues rose 3.8% to $130.9 billion, driven by Wireless (up 4.8% to $91.7 billion, about 70% of revenue), while Wireline declined 3.0% to $29.8 billion. Reported net income attributable to Verizon fell to $15.5 billion from $30.1 billion in 2017, but that comparison is distorted by the prior-year $16.8 billion non-cash tax benefit from the Tax Cuts and Jobs Act. Operating income fell to $22.3 billion from $27.4 billion, mainly because of a $4.6 billion non-cash goodwill impairment on the Oath/Verizon Media business and $2.2 billion of severance charges tied to a voluntary separation program. Cash generation improved meaningfully. Operating cash flow rose to $34.3 billion from $24.3 billion, helped by working-capital gains and lower discretionary pension contributions. Capital expenditures were $16.7 billion, so free cash flow (a non-GAAP measure) reached $17.7 billion versus $7.1 billion a year earlier. Management guides 2019 capex to $17.0 to $18.0 billion, with continued 5G investment. Dividends paid were $9.8 billion, and the quarterly dividend was raised 2.1% to $0.6025 per share, the twelfth consecutive annual increase. Consolidated Adjusted EBITDA, a non-GAAP measure, rose to $47.4 billion from $44.2 billion. The balance sheet remains heavily levered. Total debt was $113.1 billion, down from $117.1 billion, and the effective interest rate was 4.8%. Management reports that no required pension funding is expected until 2024 following 2018 discretionary contributions. Key risks flagged in the filing include Wireline's shrinking legacy voice and video base, rising competition in wireless pricing, pressure in the Verizon Media advertising business, a Wireline goodwill cushion that narrowed to 5% of fair value, and ongoing regulatory uncertainty around net neutrality and privacy.
Feb 15, 2019
2017
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2017
Verizon's 2017 Form 10-K (filed February 23, 2018) shows a business that is essentially flat on revenue but substantially stronger on profitability and cash generation. Consolidated operating revenues were $126.0 billion, roughly unchanged from 2016 ($126.0 billion), while operating income rose to $27.4 billion from $27.1 billion, and Consolidated Adjusted EBITDA increased about 0.7% to $45.1 billion. Wireless remains the core engine, generating $87.5 billion of revenue (about 69% of the total, down 1.9%) and $29.2 billion of segment operating income, while Wireline revenue grew 0.6% to $30.7 billion, aided by the XO acquisition, and its segment operating income swung to a $380 million profit from a $294 million loss the prior year. Reported GAAP net income surged to $30.1 billion (diluted EPS of $7.36) versus $13.1 billion ($3.21) in 2016, but this is driven by a one-time, non-cash $16.8 billion income tax benefit from the Tax Cuts and Jobs Act, which lowered the effective tax rate to -48.3%. Investors should look past this headline figure to underlying earnings power. Cash flow from operations was $25.3 billion, free cash flow rose to $8.1 billion from $5.8 billion, and dividends paid were $9.5 billion, so free cash flow still does not cover the dividend, which is a key watch item. Total debt rose to $117.1 billion, and the company is pursuing a $10 billion zero-based cost reduction program alongside a 2018 capex guide of $17.0 to $17.8 billion, including the 5G launch. Strategically, Verizon is positioning itself around network leadership, 5G (with residential fixed wireless launches planned in three to five markets in 2018), One Fiber fiber densification, and new media and IoT/telematics businesses anchored by the Yahoo operating business combined into Oath. Key risks include intensifying wireless competition, the shift from fixed-term to unsubsidized pricing (now about 80% of postpaid phones), linear video declines, access line losses, and rising pension and healthcare costs. Pension plans are underfunded at year end, though a $3.4 billion discretionary contribution in 2017 should keep mandatory funding minimal through 2020.
Feb 23, 2018
2016
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2016
Verizon's FY2016 Form 10-K (filed February 21, 2017) shows a company whose consolidated revenue fell 4.3% to $126.0 billion, driven by a 2.7% decline in Wireless revenue (to $89.2 billion, about 71% of the total) and a 2.3% decline in Wireline (to $31.3 billion). Operating income dropped 18% to $27.1 billion, mainly because of $2.9 billion in net pre-tax severance, pension and benefit charges, $1.8 billion in early debt redemption costs recorded below operating income, and a $1.0 billion gain on the Access Line Sale that partly offset those charges. Net income attributable to Verizon fell to $13.1 billion, or $3.21 per diluted share, versus $4.37 in 2015. Consolidated Adjusted EBITDA rose 1% to $44.1 billion when non-operational items are excluded, and Wireless Segment EBITDA margin improved to 43.8%. Cash generation weakened sharply. Operating cash flow fell to $22.7 billion from $38.9 billion, and free cash flow dropped to $5.7 billion from $21.2 billion. Management attributes much of the decline to a change in how device payment receivables are monetized: receivables sales moved from operating cash flow to asset-backed securitizations, which are recorded in financing cash flow. Dividends paid were $9.3 billion, which exceeded free cash flow in 2016. Total debt was $108.1 billion at year-end, down from $109.7 billion, and the company raised its quarterly dividend 2.2% to $0.5775, the tenth consecutive annual increase. Management is also pursuing growth investments in mobile media and IoT, including the pending Yahoo operating business purchase (about $4.48 billion after a $350 million price reduction), the completed Fleetmatics and Telogis acquisitions, and the XO Holdings wireline acquisition (closed February 1, 2017). It is also selling 24 data center sites to Equinix for about $3.6 billion. Management expects continued declines in Wireless service revenue as customers migrate to unsubsidized pricing. For investors, the central question is whether Verizon can sustain its dividend and fund its growth agenda while free cash flow is under pressure. Wireless's cash generation remains strong, but the Wireline business continues to shrink in voice and legacy data, and leverage remains high at roughly 2.5x Consolidated Adjusted EBITDA based on debt levels. Management's guidance points to a shift toward data, fiber and new platforms, with 5G fixed wireless service targeted for 2018.
Feb 21, 2017
2015
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2015
Verizon's 2015 10-K shows a company in transition: revenue grew 3.6% to $131.6 billion and operating income more than doubled to $33.1 billion, but that jump is largely due to a $2.3 billion net pension and benefit credit versus a $7.5 billion charge in 2014. Excluding non-operational items, Consolidated Adjusted EBITDA rose 7.7% to $46.6 billion. Wireless (about 70% of revenue, 112.1 million retail connections) drove growth, with revenue up 4.6% on a 54.4% jump in equipment sales tied to the Verizon device payment program, while service revenue fell 3.1% as customers shifted to unsubsidized pricing. Wireline revenue declined 1.8%, with Fios growth offsetting shrinking voice and Global Enterprise sales. Cash generation strengthened, with free cash flow of $21.2 billion (up from $13.4 billion), helped by $5.9 billion from receivable sales and $2.4 billion from the American Tower tower transaction. Those inflows, however, are one-time or financing-like in nature. Total debt was $110.2 billion at year-end, and management plans to use proceeds from the pending Frontier sale (about $10.5 billion) to reduce debt and return to its pre-Wireless Transaction credit rating by 2018-2019. Dividends were raised 2.7% to $0.565 per quarter, the ninth consecutive annual increase, and shareholders received $8.5 billion in dividends during 2015. Key risks include intensifying wireless competition, the FCC's 2015 reclassification of broadband as a Title II service, rising pension and healthcare costs, the expiration of wireline union contracts, and a heavy debt load. Management also expects Wireline margins to decline after the Frontier closing and expects 2016 capital expenditures of $17.2-17.7 billion.
Feb 23, 2016
2014
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2014
Verizon's FY2014 10-K (filed February 23, 2015) reflects a transformative year driven by the February 21, 2014 completion of the Wireless Transaction, in which Verizon acquired Vodafone's indirect 45% interest in Verizon Wireless for approximately $130 billion (about $58.9 billion in cash, roughly 1.27 billion shares valued at $61.3 billion, $5.0 billion of floating rate notes, and other consideration). This gave Verizon 100% ownership of Verizon Wireless, which generated $87.6 billion of 2014 revenue (about 69% of the total) and $26.8 billion of segment operating income. Consolidated operating revenues rose 5.4% to $127.1 billion, while reported operating income fell to $19.6 billion from $32.0 billion, largely because of a $7.5 billion non-operational severance, pension and benefit charge driven by a lower discount rate (4.2% versus 5.0%). Reported net income attributable to Verizon fell to $9.6 billion ($2.42 per diluted share) from $11.5 billion, though Consolidated Adjusted EBITDA rose to $43.3 billion from $42.0 billion. Balance sheet and cash flow changed sharply. Total debt rose to $113.3 billion from $93.6 billion, and cash fell to $10.6 billion from $53.5 billion after the Vodafone payment. Operating cash flow was $30.6 billion, down from $38.8 billion, reflecting higher cash taxes and interest after the transaction. Capital expenditures were $17.2 billion, leaving free cash flow of $13.4 billion, which still covered $7.8 billion of dividends. Management said it expects to return to pre-transaction credit metrics by 2019, and the 2015 capex guidance is $17.5 to $18.0 billion. Wireline revenue declined 0.5% to $38.4 billion, with Global Enterprise and Global Wholesale declines offsetting FiOS-driven Mass Markets growth. Subsequent events in the filing also reshape the company. Verizon won spectrum in the AWS-3 auction for about $10.4 billion. It agreed to sell 11,300 towers to American Tower for a $5.0 billion upfront payment and to sell its California, Florida and Texas landline business to Frontier for about $10.5 billion, with that sale expected to close in the first half of 2016. Verizon also launched a $5.0 billion accelerated share repurchase in February 2015.
Feb 23, 2015
2013
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2013
Verizon's FY2013 10-K (filed February 27, 2014) is dominated by the Wireless Transaction: Verizon acquired Vodafone's 45% interest in Verizon Wireless for approximately $130 billion, completed February 21, 2014, giving it 100% ownership of the business that generated about 67% of 2013 revenues ($81.0B of $120.6B). The consideration was roughly $58.9B cash, $60.15B in Verizon stock (about 1.27 billion new shares), $5.0B in Verizon notes, the sale of its 23.1% Vodafone Omnitel stake (valued at $3.5B), and about $2.5B of other consideration. The cash portion was funded mainly by debt, including $49.0B of notes issued in September 2013, so total debt rose from about $51.99B to $93.6B at year-end 2013, with roughly $20.3B more added after year-end. Financially, 2013 was strong on a reported basis. Consolidated operating revenues grew 4.1% to $120.55B, operating income more than doubled to $31.97B, and net income attributable to Verizon reached $11.5B ($4.00 diluted EPS), helped by a $6.2B net pre-tax pension and benefit credit that is excluded from Consolidated Adjusted EBITDA. Adjusted EBITDA rose to $42.06B from $37.47B. Wireless revenue grew 6.8% on postpaid connection growth and smartphone penetration (70% of retail postpaid phones), while Wireline revenue fell 1.4% as legacy Core and Global Wholesale declines offset FiOS and Strategic services growth. Free cash flow reached $22.2B, up from $15.3B. Management guided that 2014 cash flow from operations would be pressured by higher taxes, interest, and the end of distributions to Vodafone. The main investor considerations are the sharply higher leverage, the dilution from 1.27 billion new shares, the credit ratings downgrades (Moody's to Baa1, S&P to BBB+, Fitch to A-), and the fact that the 2013 earnings figures are not fully representative of the post-transaction structure, since Verizon will absorb Vodafone's share of Wireless income and noncontrolling interest income will decline substantially in 2014. Dividends were raised 2.9% to $0.53 per quarter, the seventh consecutive annual increase, and the company disclosed material litigation, including the Idearc and FairPoint fraudulent-transfer suits, though it did not expect them to be material.
Feb 27, 2014
2012
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2012
Verizon's 2012 Form 10-K (filed February 26, 2013) shows a company with strong top-line growth driven by its wireless business, offset by heavy non-operating pension charges that depressed reported earnings. Consolidated operating revenues rose 4.5% to $115.8 billion, led by Verizon Wireless service and equipment revenue growth of 8.1% to $75.9 billion, while Wireline revenues declined 2.2% to $39.8 billion as legacy voice, wholesale and enterprise lines eroded. Net income attributable to Verizon fell to $875 million, or $0.31 per diluted share, from $2.4 billion in 2011, primarily because of $7.2 billion of severance, pension and benefit charges and roughly $1.1 billion of early debt redemption costs. Excluding these items, Consolidated Adjusted EBITDA rose 6.0% to $37.5 billion. Cash generation and balance sheet metrics remained solid. Operating cash flow was $31.5 billion and free cash flow was $15.3 billion, up from $13.5 billion, while capital expenditures were roughly flat at $16.2 billion. Net debt to Consolidated Adjusted EBITDA was 1.3x, and the dividend was raised 3% to $0.515 per quarter, the sixth consecutive annual increase. Verizon also spent about $3.9 billion on AWS spectrum and $0.6 billion on HUGHES Telematics, and it is selling lower 700 MHz B block licenses to AT&T for $1.9 billion. Investors should weigh the pension remeasurement losses, the Wireline revenue decline and the Idearc and FairPoint litigation against the wireless growth and LTE build-out.
Feb 26, 2013
2011
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2011
Verizon Communications (VZ) reported 2011 operating revenues of $110.9 billion, up 4.0% from $106.6 billion in 2010, driven by Verizon Wireless, which grew revenue 10.6% to $70.2 billion (about 63% of the total). Wireline revenues fell 1.3% to $40.7 billion as wireless substitution, access line losses and declines in Global Wholesale offset growth in FiOS and strategic services. Reported operating income fell 12.1% to $12.9 billion, and net income attributable to Verizon fell to $2.4 billion ($0.85 per diluted share) from $2.5 billion, mainly because of a $6.0 billion pre-tax severance, pension and benefit charge recorded in the fourth quarter after a lower discount rate. Excluding these non-operational items, Consolidated Adjusted EBITDA rose to $35.3 billion from $34.4 billion, and free cash flow declined to $13.5 billion from $16.9 billion as operating cash flow fell to $29.8 billion on device purchases, pension contributions and divested operations. Capital expenditures were $16.2 billion, or 14.7% of revenue. Verizon raised its quarterly dividend 2.6% to $0.50 per share, the fifth consecutive annual increase, and paid $5.6 billion in dividends. It made no share repurchases in 2011 and has 100 million shares authorized under a program running through February 2014. The balance sheet remains solid, with net debt to Consolidated Adjusted EBITDA of 1.2x, all debt covenants met, and investment-grade ratings. Key forward-looking items include pending AWS spectrum purchases from SpectrumCo and Cox (about $3.9 billion, expected to close in 2012), DOJ review of the cable-company commercial agreements, 4G LTE expansion to virtually all of the 3G footprint by mid-2013, and roughly $9 billion in litigation exposure from the Idearc and FairPoint creditor suits.
Feb 24, 2012
2010
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2010
Verizon Communications' 2010 Form 10-K (filed February 28, 2011) shows a company whose growth is concentrated in Domestic Wireless while the Wireline business shrinks. Consolidated operating revenues fell 1.2% to $106.6 billion, largely due to divested operations (Alltel divestiture markets and the July 2010 spin-off/merger of rural landline assets with Frontier). Domestic Wireless revenue rose 5.1% to $63.4 billion, with total data revenue reaching $19.6 billion (35.1% of service revenue), while Wireline revenue declined 2.9% to $41.2 billion amid switched access line losses. Operating income fell 8.3% to $14.6 billion, weighed down by $3.1 billion of severance, pension and benefit charges tied to a union agreement, while net income attributable to Verizon fell to $2.5 billion ($0.90 per diluted share) from $4.9 billion, reflecting a $1.0 billion one-time non-cash tax charge from the Health Care Act and a larger share of earnings going to Vodafone's 45% noncontrolling stake in Verizon Wireless. Cash generation remained strong. Operating cash flow rose to $33.4 billion and capital expenditures fell to $16.5 billion, producing free cash flow of $16.9 billion, up from $14.5 billion in 2009. Management guided 2011 capital spending to be flat or lower, and the Board raised the quarterly dividend 2.6% to $0.4875 while authorizing a new buyback of up to 100 million shares. Debt declined to $52.8 billion from $61.2 billion, helped by the $3.1 billion special cash payment from the Frontier transaction and the repayment of Verizon Wireless bank facilities. Key risks for investors include intensifying competition, continued access line erosion in Wireline, the cost of the LTE build-out, spectrum needs, union contract renegotiations in 2011, and the Idearc litigation trust suit seeking over $9 billion in damages. The filing also notes that the company intends to acquire Terremark for about $1.4 billion, expected to close in Q1 2011.
Feb 28, 2011
2009
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2009
Verizon's 2009 Form 10-K shows a company whose growth came mainly from the January 2009 acquisition of Alltel, which made Verizon Wireless the largest U.S. wireless carrier by customers and revenue. Consolidated operating revenues rose 10.7% to $107.8 billion, and Domestic Wireless now represents about 58% of revenue ($62.1 billion, up 25.9%). Wireline revenue fell 4.4% to $46.1 billion, reflecting continued access line losses (down 10% in 2009) partly offset by FiOS growth. Reported operating income fell 16.9% to $14.0 billion, pressured by roughly $4.0 billion of severance, pension and benefit charges and about $1.2 billion of merger integration costs. Diluted EPS attributable to Verizon was $1.29, down from $2.26, though net income including noncontrolling interest was $10.4 billion. Cash generation remained strong, with operating cash flow up $4.0 billion to $31.6 billion. Capital expenditures declined to $17.0 billion, and the company guided 2010 capex to $16.8–17.2 billion. Total debt rose sharply, long-term debt reached $55.1 billion, and the debt-to-capital ratio climbed to 59.9% from 55.5%. Verizon kept an 'A' rating framework, though S&P's outlook was Negative. The quarterly dividend was raised 3.3% to $0.475, costing $5.3 billion in 2009. Key forward-looking items include the planned spin-off and merger of about 4 million access lines into Frontier (expected Q2 2010), the divestiture of 105 Alltel overlapping markets, LTE launch in 25–30 markets in 2010, and ongoing competitive and regulatory pressure, including proposed FCC net neutrality rules. For investors, the central questions are whether Alltel synergies and FiOS growth can offset wireline decline and rising wireless acquisition and subsidy costs, and whether the higher leverage and pension burden constrain the dividend and financial flexibility over time.
Feb 26, 2010
2008
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2008
Verizon's 2008 10-K (filed February 24, 2009) shows a company that grew revenue 4.2% to $97.4 billion and operating income 8.4% to $16.9 billion, driven almost entirely by Domestic Wireless (Verizon Wireless, 55% owned), whose revenue rose 12.4% to $49.3 billion and operating income rose 18.6% to $14.0 billion. Wireline revenue fell 1.9% to $48.2 billion as access line losses (down 9.1% in total retail lines) outweighed growth in broadband (8.67 million connections) and FiOS TV (1.92 million customers). Net income was $6.4 billion, or $2.26 per diluted share, up from $1.90 in 2007, though 2007 comparisons were distorted by a large tax charge tied to Vodafone Omnitel distributions. The filing's most important forward-looking item is the closing of the Alltel acquisition on January 9, 2009. Verizon Wireless paid about $5.9 billion for Alltel's equity and took on roughly $22.2 billion of Alltel net debt, which pushed total debt to about $51 billion and the debt-to-capital ratio to 55.5% from 38.1%. Verizon financed the deal in part with a $12.5 billion Bridge Facility, with plans to refinance it and divest 105 overlapping markets. Management says the combined company becomes the largest U.S. wireless provider by customer count, with more than 80 million customers, and expects synergies from reduced roaming and network costs. Investors should weigh that integration and leverage against a balance sheet that still carries A-category ratings. The agencies have flagged possible downgrade triggers, and S&P and Moody's have negative outlooks. Capital and cash flow remain strong. Operating cash flow from continuing operations was $26.6 billion, and dividends rose 7% to $1.78 per share. Management expects 2009 capital spending, excluding Alltel, to be below 2008's $17.2 billion. Pension and retiree healthcare costs are a growing pressure point, and the company faces ongoing litigation over alleged NSA cooperation, which it describes as without merit.
Feb 24, 2009
2007
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2007
Verizon Communications (VZ) reported a solid 2007 with consolidated revenues of $93.5 billion, up 6.0% year over year, and operating income of $15.6 billion, up 16.5%. The operating income margin expanded to 16.7% from 15.2%, and net income available to common shareowners was $5.5 billion, or $1.90 per diluted share, roughly flat with 2006 once the prior year's discontinued operations and the 2007 CANTV extraordinary loss are considered. Growth was driven almost entirely by Domestic Wireless (Verizon Wireless, 55% owned), where revenue rose 15.3% to $43.9 billion, the company added about 6.9 million retail customers to reach 63.7 million, and data revenue grew sharply. Wireline revenue was essentially flat at $50.3 billion (down 0.8%), as access-line losses of 7.6% offset gains in FiOS broadband and TV and strategic enterprise services. For investors, the key tensions are the heavy minority-interest drag (about $5.1 billion in 2007, mostly Vodafone's 45% stake in Verizon Wireless) and the effective tax rate, which rose to 42.0% from 32.8% largely because of a $610 million charge tied to Vodafone Omnitel distributions. Free cash flow from operations was solid, with cash from continuing operations of $26.3 billion against capital expenditures of $17.5 billion. Management guided 2008 capital spending lower than 2007, reduced total debt by $5.2 billion to $31.2 billion, and repurchased $2.8 billion of stock while raising the quarterly dividend 6.2% to $0.43. The filing also flags structural risks. Cable operators are the largest competitive threat to the wireline business, wireless substitution and VoIP continue to erode voice lines, and the company faces ongoing regulatory proceedings and litigation, including class actions over alleged government surveillance cooperation. Pending transactions include the spin-off and merger of Maine, New Hampshire and Vermont access lines into FairPoint, expected around March 31, 2008, and the acquisition of Rural Cellular, expected to close in the first half of 2008.
Feb 28, 2008
2006
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2006
Verizon's 2006 Form 10-K (filed March 1, 2007) shows a company transformed by the January 2006 MCI acquisition. Consolidated operating revenues rose 26.8% to $88.1 billion, driven by Wireline growth of 35.0% (to $50.8 billion, including MCI) and Domestic Wireless growth of 17.8% (to $38.0 billion). Operating income grew modestly to $13.4 billion from $12.6 billion, while net income fell to $6.2 billion ($2.12 diluted EPS) from $7.4 billion, weighed down by a $541 million after-tax loss on the sale of Verizon Dominicana, higher minority interest expense of $4.0 billion (mostly Vodafone's 45% share of Verizon Wireless), and $1.4 billion of pension and postretirement expense. Diluted EPS from continuing operations was $1.88 versus $2.16 in 2005. Balance sheet and cash flow improved. Total debt fell to $36.4 billion from $38.3 billion, helped by the Idearc spin-off, which removed roughly $7 billion of debt and delivered about $2 billion in cash, and by the Dominicana sale. The debt-to-capital ratio dropped to 42.8% from 49.1%. Operating cash flow reached $24.1 billion, and cash and equivalents rose to $3.2 billion. Capital expenditures rose to $17.1 billion, and 2007 guidance is $17.5 to $17.9 billion. Verizon also repurchased $1.7 billion of stock and kept the dividend at $0.405 per quarter. Key forward-looking items include the pending FairPoint spin-off of Maine, New Hampshire and Vermont access lines (about $2.7 billion in value), the expected TELPRI sale (about $900 million), a likely first-quarter 2007 loss on the CANTV investment after Venezuela's nationalization move, and the Broadcom ITC case, which could restrict Qualcomm EV-DO handset supply. FiOS passed more than 6 million homes and reached 207,000 TV customers, and Verizon Wireless ended the year with 59.1 million customers.
Mar 1, 2007
2005
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2005
Verizon's 2005 10-K (filed March 14, 2006) describes a company in transition: wireline access lines are declining while wireless, broadband (FiOS, DSL) and long distance grow. Consolidated 2005 revenues rose 5.4% to $75.1 billion and operating income rose 13% to $14.8 billion, led by Domestic Wireless revenue growth of 16.8% to $32.3 billion. Net income was $7.4 billion ($2.65 diluted EPS), down from $7.8 billion in 2004, which included a $516 million discontinued-operations gain. The drop reflects a $787 million TELUS gain in 2004 that did not recur, lower equity earnings, and higher minority interest of $3.0 billion, largely Vodafone's 45% share of Verizon Wireless. The filing is dominated by the pending MCI acquisition, which closed January 6, 2006. The combined company gains a major global IP network (over 270,000 domestic and 360,000 international route miles) and the Verizon Business brand, with management targeting roughly $1.1 billion in annual synergies by 2008. Integration will add costs and capital expenditure, and 2006 capex is guided to $17.0–17.4 billion including MCI, versus $15.3 billion in 2005. Verizon also issued $4 billion of notes in February 2006 and redeemed MCI debt, while its share buyback authorization was raised to 100 million shares. Investors should weigh the strong wireless franchise and cash generation (operating cash flow of $22.0 billion) against structural pressure in wireline voice, a 2006 credit rating downgrade by S&P to A, and the execution risk of integrating MCI. Information Services is being explored for divestiture, and large uncertainties remain in regulatory proceedings, the Hicksville environmental matter and the Vodafone put option on Verizon Wireless.
Mar 14, 2006
2004
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2004
Verizon Communications' 2004 10-K (filed March 14, 2005) shows a company in transition: consolidated operating revenues rose 5.7% to $71.3 billion, driven almost entirely by Domestic Wireless (revenues up 23.0% to $27.7 billion, with 6.3 million net customer additions to 43.8 million subscribers). Domestic Telecom, the wireline business, continued to shrink, with revenues down 2.7% as access lines and switched minutes declined and regulatory pricing pressure on unbundled network elements persisted. Wireline is still the largest segment by revenue (about 54%), but wireless is now the profit engine, and Verizon Wireless is described as the most profitable U.S. wireless operator by operating income. Reported earnings were strong, but the quality of the improvement needs context. Net income rose to $7.8 billion ($2.79 diluted EPS) from $3.1 billion, helped by a $787 million pretax gain on the sale of the TELUS stake, a $516 million after-tax gain on selling Verizon Information Services Canada, and the absence of the large 2003 severance charges (the 2003 voluntary separation plan cost about $5.5 billion). Operating income rose to $13.1 billion from $7.4 billion, though the 2003 base was depressed by those charges. Segment income excluding special items fell 17.6% in Domestic Telecom and 13.7% in Information Services, while Domestic Wireless segment income rose 51.9%. Free cash flow was constrained by $13.3 billion of capital expenditures against $21.8 billion of operating cash flow, and total debt fell to $39.3 billion from $45.4 billion. The filing's most significant forward-looking item is the February 14, 2005 agreement to acquire MCI for a mix of Verizon shares and cash, plus assumption of MCI's net debt. The company expects regulatory approval in about a year and warned that the deal could lead to credit rating downgrades. Other pending items include the planned $3.0 billion NextWave spectrum purchase, the $1.65 billion sale of Hawaii wireline operations, and ongoing FCC unbundling and intercarrier compensation rulemakings that could further affect wireline economics. Investors will need to weigh the wireless growth engine against continued access line erosion and the balance-sheet and integration risks of the MCI transaction.
Mar 14, 2005
2003
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2003
Verizon Communications' 10-K for fiscal 2003 (filed March 12, 2004) shows a company generating strong operating cash flow of $22.5 billion while absorbing heavy one-time charges. Consolidated revenues were essentially flat at $67.75 billion (up 0.7%), but operating income fell to $7.5 billion from $15.0 billion, driven largely by a $5.5 billion severance and pension charge tied to a voluntary separation plan of more than 25,000 employees, a $2.7 billion cumulative-effect charge from switching directory revenue recognition to the amortization method, and a $957 million pretax loss on the sale of Iusacell. Reported net income was $3.08 billion ($1.11 diluted EPS), down from $4.08 billion ($1.49) in 2002, though 2002 itself included large investment write-downs. The underlying business shows a clear mix shift. Domestic Wireless (Verizon Wireless, 55% owned with Vodafone holding 45%) grew revenue 15.5% to $22.5 billion, adding 5.0 million net customers to reach 37.5 million, while Domestic Telecom revenue fell 3.0% as access lines and local services eroded from competition, UNE pricing rules and wireless substitution. Management reduced the Domestic Telecom workforce by about 14% and cut debt, with total debt repayments of $7.4 billion in 2003. Long-term debt declined to $39.4 billion from $44.0 billion. Capital spending is guided to $12 to $13 billion for 2004, and the board authorized a new buyback of up to 80 million shares. The dividend was held at $1.54 per share annually. Investors should weigh the Verizon Wireless growth and cost-cutting against continuing wireline erosion and regulatory risk. The filing also flags a pending Vodafone put option of up to $20 billion on its wireless stake between 2003 and 2007, a potential 4 to 6 cent per share 2004 earnings hit from the FCC's UNE/EEL order, and a $240 million Hicksville environmental charge.
Mar 12, 2004
2002
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2002
Verizon Communications' 10-K for fiscal 2002 shows a company with a large, cash-generative core business under pressure from wireline erosion, offset by growth at Verizon Wireless. Consolidated operating revenues rose 0.6% to $67.6 billion, and operating income climbed 30% to $15.0 billion, though the increase is flattered by $2.7 billion of net gains on asset sales, primarily the sale of about 1.27 million non-strategic access lines. Domestic Telecom revenues fell 3.3% as local service declined 5.4% amid weak demand, mandated price cuts, and technology substitution. Domestic Wireless revenues rose 10.7% to $19.3 billion, with 32.5 million customers and churn improving to 2.3%. Net income was $4.1 billion ($1.49 per diluted share), down from the prior year's depressed level but well below 2000's $11.8 billion. The gap reflects roughly $6.2 billion of pretax investment-related losses, principally write-downs of Genuity, CANTV, TELUS and MFN, plus $1.3 billion of severance and pension charges and a $496 million cumulative-effect accounting charge. Operating cash flow was strong at $22.1 billion, capital spending fell to $12.0 billion, and total debt was reduced by about $11.6 billion, lowering the debt-to-capital ratio to 62.4% from 66.4%. The dividend was held at $1.54 per share. Investors should weigh the quality of earnings. Gains from asset sales and tax benefits on investment losses flatter reported results, the wireline business is shrinking, and Verizon faces a potential cash call of up to $10 billion in 2003 or 2004 under the Vodafone put option on its wireless joint venture stake. Regulatory uncertainty around unbundling, access charges and long-distance entry, and WorldCom's bankruptcy exposure (about $2.1 billion of 2002 revenue from WorldCom) remain key risks.
Mar 14, 2003
2001-A
VERIZON COMMUNICATIONS INC Annual Report (Amendment), Year Ended Dec 31, 2001
Verizon Communications Inc. reported significant revenue growth for the year ended December 31, 2001, with operating revenues reaching $67.19 billion, an increase from the previous year. However, net income available to common shareholders saw a substantial decrease, falling to $389 million from $11.79 billion in 2000. This decline was heavily influenced by "special items," including substantial losses on investments in companies like Genuity, Cable & Wireless, and NTL, along with significant merger transition costs and severance charges. The Domestic Wireless segment demonstrated strong revenue growth, driven by customer additions. Conversely, the Domestic Telecom segment experienced a slight revenue decline due to economic pressures and mandated price reductions, although data transport and long-distance services showed resilience. The company's financial position shows total assets of $170.8 billion and long-term debt of $45.7 billion.
Jun 3, 2002
2001
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 2001
Verizon Communications (VZ) reported 2001 operating revenues of $67.19 billion, up 3.8% from $64.71 billion in 2000, but the headline earnings collapsed: net income available to common shareowners fell to $389 million, or $0.14 per diluted share, versus $11.8 billion ($4.31) in 2000. The drop is driven almost entirely by non-operating special items, most notably a $4.86 billion pretax loss on securities (Cable & Wireless, NTL, MFN), a $1.25 billion write-down of the Genuity investment, a $1.0 billion after-tax severance and pension charge, and a $663 million after-tax international restructuring charge tied to Argentina's CTI. Management's adjusted net income was $8.19 billion, or $3.00 per diluted share, up from $2.91 in 2000, which signals underlying operating momentum even as the GAAP picture is distorted. Investors should separate these one-time items from the recurring business when assessing the year. The operating story is mixed. Domestic Wireless (Verizon Wireless, 55% owned) was the growth engine, with 29.4 million customers, up about 10%, and revenue up 22%. Domestic Telecom revenue slipped 0.6% under regulatory price cuts, competition and wireless substitution, although data transport and long distance grew strongly. Cash from operations rose to $19.8 billion, but capital spending of about $17.4 billion and dividend payments left the company reliant on external financing. Total long-term debt reached $45.7 billion, and the debt-to-equity ratio climbed to 66.4% from 62.4%. Several material forward-looking items remain: a $8.8 billion FCC spectrum purchase, the planned Verizon Wireless IPO, pending access-line sales totaling roughly $4.1 billion, and contingent Vodafone put obligations of up to $20 billion. The filing also flags meaningful risks. Moody's moved its outlook to negative in April 2001, citing dependence on the Verizon Wireless IPO, which had not yet occurred. Regulatory uncertainty persists across state rate-setting and FCC interconnection and unbundling rules, and long distance entry depends on Section 271 approvals. The Genuity investment and the mark-to-market exposure on exchangeable notes add earnings volatility. The 2002 capital spending guidance of $15 billion to $16 billion and the expected Genuity and CTI-related pressures will weigh on near-term free cash flow.
Mar 20, 2002
1998
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 1998
This 10-K is filed by Bell Atlantic Corporation, the predecessor to today's Verizon (VZ), for fiscal 1998. Reported 1998 operating revenues rose 4.6% to $31.57 billion, and reported net income was $2.97 billion, or $1.86 diluted EPS. Reported results include $1.81 billion of pre-tax special items, mainly retirement incentive costs ($1.02 billion), merger-related costs ($196 million), and write-downs of Asian investments ($485 million). Excluding these items, adjusted net income was $4.32 billion, or $2.72 diluted EPS, up from $2.45 in 1997. The core Domestic Telecom segment generated about 81% of revenue, and the company is growing its wireless business, with Bell Atlantic Mobile serving 6.2 million customers. The dominant strategic event is the pending merger of equals with GTE, under which GTE shareholders would receive 1.22 Bell Atlantic shares per GTE share. Management projects roughly $2 billion of annual revenue synergies, $2 billion of expense savings, and $500 million of capital savings by the third year after closing. Combined direct and transition costs are estimated at $1.6 to $2.0 billion pre-tax. Investors should weigh these synergy targets against sizable integration costs and the continuing competitive and regulatory pressures from the 1996 Telecommunications Act, including reciprocal compensation payments that are expected to rise to about $350 million in 1999. Balance sheet leverage increased. Long-term debt rose to $17.6 billion from $13.3 billion, largely due to $5.6 billion of exchangeable notes backed by stakes in TCNZ and Cable & Wireless Communications. Capital expenditures reached $7.4 billion in 1998, and management guides to about $8.1 billion in 1999, with a $1.6 billion Year 2000 and Domestic Telecom network investment program. Dividends were raised to $1.54 per share for 1998, and the debt-to-capital ratio edged up to 61.3%.
Mar 30, 1999
1997-A
VERIZON COMMUNICATIONS INC Annual Report (Amendment), Year Ended Dec 31, 1997
Bell Atlantic's 1997 10-K reflects a transformative year, anchored by the August 14, 1997 merger with NYNEX, accounted for as a pooling of interests, so all prior periods are restated. Reported 1997 net income was $2,454.9 million, or $1.56 diluted EPS (post-split), down from $3,402.0 million in 1996, which included a $273.1 million cumulative accounting benefit. Excluding special items, management cites net income of $3,846.8 million ($2.45 diluted EPS) for 1997, versus $3,474.2 million ($2.23) in 1996. Operating revenues grew 3.6% to $30.19 billion, led by wireless services (up 22.7%) and local services, while operating income declined to $5.34 billion from $6.08 billion, weighed down by roughly $1.56 billion in merger-related costs, retirement incentive charges, and asset write-downs. Financial position improved in some respects but tightened in others. Long-term debt fell to $13.27 billion from $15.29 billion, but short-term debt rose sharply to $6.34 billion, largely due to commercial paper, and the debt ratio rose to 60.5% from 58.3%. Operating cash flow was strong at $8.86 billion, covering dividends of about $2.34 billion and capital expenditures of $6.64 billion, though 1998 capex is guided to about $7.0 billion. Management targets 1998 earnings growth of 10% to 12% excluding merger transition costs, merger savings of $450 million in 1998 rising to $1.1 billion by 2000, and in-region long distance entry in the second half of 1998, which remains subject to FCC approval and pending court appeals. Investors should weigh the upside of merger synergies and wireless growth against execution risk, including ongoing retirement incentive costs, Telecommunications Act uncertainty, competitive pressures in intraLATA toll and local markets, Asian market exposure in cost investments, and a Year 2000 remediation program estimated at $200 million to $300 million. The June 1998 two-for-one stock split and a dividend of $1.51 per share (split-adjusted) for 1997 are also relevant to per-share comparisons.
Jun 29, 1998
1997
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 1997
This 10-K for Bell Atlantic Corporation (the filing header says Verizon Communications, but the content is Bell Atlantic's 1997 report, filed before the 2000 Verizon merger) covers a year dominated by the August 14, 1997 merger with NYNEX, under which NYNEX became a subsidiary and NYNEX shareowners received 0.768 Bell Atlantic shares per NYNEX share. The company recognized about $519 million in merger-related costs in 1997 and targets roughly $1.1 billion in annual recurring expense savings and about $300 million in annual capital savings by 2000, through about 3,100 management position eliminations, network consolidation, and procurement centralization. Telephone subsidiaries generated about 80% of 1997 operating revenue, and capital expenditures were about $6.6 billion. The telephone business faces growing local competition under the 1996 Telecommunications Act, and the company is pursuing entry into in-region long distance, with a New York FCC petition planned for the second half of 1998. The company also holds a broad portfolio of international and wireless investments, including Bell Atlantic Mobile with about 5.4 million U.S. customers, a 42.1% economic interest in Grupo Iusacell in Mexico, a 24.95% stake in Telecom New Zealand, an 18.5% stake in Cable and Wireless Communications in the UK, and a 17.45% stake in Omnitel in Italy. In February 1998 it issued about $2.5 billion of exchangeable notes tied to its TCNZ stake. Key risks include the outcome of the District Court ruling on the Act's line-of-business restrictions (stayed pending appeal), FCC access-charge and universal service rulemakings, a union contract expiration in August 1998 covering about 70% of its 141,000 employees, and Year 2000 remediation. Full financial statements, MD&A, and selected financial data are incorporated by reference from the 1997 Annual Report to shareowners and were not included in the text provided.
Mar 25, 1998
1996-A
VERIZON COMMUNICATIONS INC Annual Report (Amendment), Year Ended Dec 31, 1996
This filing is Amendment No. 1 to Bell Atlantic Corporation's 10-K for fiscal 1996, filed April 18, 1997. It does not contain the company's full annual report. It attaches Form 11-K financial statements for two employee savings plans: the Bell Atlantic Savings Plan for Salaried Employees (BASP) and the Bell Atlantic Savings and Security Plan for Non-Salaried Employees (BASSP). The registrant was Bell Atlantic (NYSE: BEL), not Verizon (VZ), which did not exist until the 2000 merger. For investors, the document is mainly relevant as a record of employee retirement assets and Bell Atlantic stock exposure, not as a source of corporate performance data. Combined net assets available for benefits were about $3.76 billion at December 31, 1996. BASP net assets were $2.31 billion, down from $2.35 billion in 1995, and BASSP net assets were $1.45 billion, essentially flat versus $1.45 billion a year earlier. The Bell Atlantic Shares Fund, which holds company stock, is the largest component. Bell Atlantic common stock fell from $66.88 to $64.75 during 1996, a 3.18% decline, which reduced the value of that fund. Net investment income for BASP was $136.5 million in 1996, down from $600.6 million in 1995, mainly because the 1995 figure included large equity market gains. Benefit payments to participants were $230.3 million from BASP and $144.3 million from BASSP. The plans also carry leveraged ESOP (LESOP) debt, with $270.2 million outstanding under BASP and $158.8 million under BASSP at year-end 1996. Both plans are described as subject to the pending Bell Atlantic-NYNEX merger, under which NYNEX holders would receive 0.768 Bell Atlantic shares per NYNEX share. The filing states there are no plans regarding the merger's impact on the plans. Because the employee plans are held in a commingled Master Trust, their results largely track Bell Atlantic's share price and the performance of the index funds.
Apr 18, 1997
1996
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 1996
This 10-K, filed March 25, 1997, is for Bell Atlantic Corporation (the predecessor of today's Verizon, which the request identified as VZ), covering fiscal 1996. The company reported operating revenues of $13,081.4 million, down about 2.6% from $13,429.5 million in 1995, and net income of $1,881.5 million, or $4.28 per share. Income before the cumulative effect of an accounting change was $1,739.4 million ($3.96 per share), down from $1,861.8 million in 1995. The 1996 results were helped by a $142.1 million non-cash gain from changing how directory publishing revenues are recognized, and a 1995 gain of about $314 million on cellular property sales had flattered the prior year. Equity income from the Bell Atlantic NYNEX Mobile wireless partnership rose to $360.4 million, offsetting heavy start-up losses in PCS, Omnitel, and other new ventures. The central investor issue is the pending merger of equals with NYNEX Corporation, approved by shareowners in November 1996 and expected to close around April 1997. NYNEX holders would receive 0.768 Bell Atlantic shares per NYNEX share, with NYNEX holders owning about 44% of the combined company. Management projects about $600 million in annual recurring expense savings by the third year after closing, with transition costs of $700 million to $900 million, though the MD&A breaks these costs down differently. Pro forma combined 1996 revenues would be about $29.1 billion. The company's core regulated telephone business faces growing competition under the Telecommunications Act of 1996, including 40 interconnection agreements with competitive local carriers and an expected 1997 push into long distance, while toll revenues declined 3.2% in 1996 from price cuts and competition. Financially, the company generated $4.4 billion in operating cash flow and spent about $2.5 billion on capital expenditures. Long-term debt fell to $5.96 billion, and the debt ratio improved to 52.2% from 55.5%. Dividends were $2.88 per share in 1996, with a post-merger annualized dividend expected at $3.08 per share. The company also restructured its Mexican investment, Iusacell, in February 1997 to gain management control, which will move it from equity to full consolidation accounting and includes put options that could be material.
Mar 25, 1997
1995-A
VERIZON COMMUNICATIONS INC Annual Report (Amendment), Year Ended Dec 31, 1995
This filing is not a full 10-K for Verizon Communications (VZ). It is Amendment No. 1 to the 10-K for fiscal 1995 of Bell Atlantic Corporation, the predecessor company, filed April 29, 1996. Its only purpose is to add two Form 11-K exhibits covering the employee savings plans: the Bell Atlantic Savings Plan for Salaried Employees (BASP) and the Bell Atlantic Savings and Security Plan for Non-Salaried Employees (BASSP). It contains no corporate income statement, balance sheet, segment data, or management discussion. The filing therefore offers little direct information on Bell Atlantic's operating performance or financial health. The exhibits do show a strong year for plan participants and a material ESOP-related obligation. Combined net assets available for plan benefits were about $3.81 billion at December 31, 1995 (BASP $2.35 billion; BASSP $1.45 billion), up from about $2.87 billion a year earlier. Bell Atlantic common stock rose 34.42%, from $49.75 to $66.88 per share, which drove the Bell Atlantic Shares Fund's large investment gains. Employee participation in company stock is heavy: about 43% of BASP assets and 63% of BASSP assets were invested in the Bell Atlantic Shares Funds. For investors, the main points are the concentration of employee retirement assets in one stock and the leveraged ESOP debt. Leveraged ESOP notes totaled about $497.8 million in carrying value across both plans (BASP $306.1 million; BASSP $191.8 million), carry an 8.17% rate, and are guaranteed by Bell Atlantic, with final payment due January 1, 2000. Because this is an amendment that adds only plan exhibits, investors should consult the original 10-K for Bell Atlantic's consolidated financial results.
Apr 29, 1996
1994-A
VERIZON COMMUNICATIONS INC Annual Report (Amendment), Year Ended Dec 31, 1994
This filing is not a Verizon Communications 10-K. It is Amendment No. 1 (Form 10-K/A, dated April 28, 1995) from Bell Atlantic Corporation (Commission File No. 1-8606) to its 2014-era... no, to its 1994 Annual Report on Form 10-K. Its only content is two Form 11-K employee savings plan reports, Exhibit 99.A (Bell Atlantic Savings Plan for Salaried Employees) and Exhibit 99.B (Bell Atlantic Savings and Security Plan for Non-Salaried Employees), which cover the year ended December 31, 1994. Verizon did not exist until 2000, so the company name and ticker in the request do not match the document. The filing contains no consolidated company financials, revenue, earnings, or segment data, so it offers little direct insight into the operating business. Its investor relevance is mainly through the plans' exposure to Bell Atlantic stock, which fell 16.22% in 1994, from $59.38 to $49.75 per share. The Salaried plan's net assets available for benefits declined to $1,824.5 million at December 31, 1994, from $1,968.0 million a year earlier. The Non-Salaried plan's net assets fell to $1,048.3 million from $1,137.0 million. Both declines were driven by negative investment returns on the Bell Atlantic Shares Fund, which held roughly 40% of Salaried plan assets and 58% of Non-Salaried plan assets. Both plans also carry Leveraged ESOP notes payable at an 8.17% rate, guaranteed by Bell Atlantic. The Salaried plan's share was $351.2 million carrying value versus $364.1 million fair value, and the Non-Salaried plan's share was $220.1 million versus $228.1 million. The auditor, Coopers & Lybrand, issued unqualified opinions dated April 19, 1995. For investors, the key takeaways are that employee retirement assets are heavily concentrated in company stock, that 1994 equity market and stock price weakness reduced those balances, and that ESOP debt is a contingent obligation guaranteed by the parent. Bell Atlantic common stock traded between $48.88 and $54.63 from January 1 through April 19, 1995, somewhat above the year-end 1994 close.
Apr 28, 1995
1994
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 1994
Bell Atlantic Corporation's 10-K for fiscal 1994 reports a net loss of $754.8 million, or $1.73 per share, compared with net income of $1,403.4 million, or $3.22 per share, in 1993. The loss was driven by a noncash, after-tax extraordinary charge of $2,150.0 million, recorded when the telephone subsidiaries discontinued Statement of Financial Accounting Standards No. 71 (regulatory accounting) effective August 1, 1994. Income before extraordinary items and cumulative effects was $1,401.9 million, or $3.21 per share, versus $1,481.6 million in 1993. Operating revenues rose to $13,791.4 million from $13,145.6 million, while operating income was $2,804.6 million, roughly flat with $2,797.6 million the prior year. The filing describes a company restructuring its workforce, with 400 employees separated in 1994 and about 5,200 more expected through 1997, and a $161.9 million pretax charge for separation benefits. Wireless services revenue grew to $1,059.8 million from $785.5 million, while the company sold most of its lease financing business (TriCon) for proceeds that included $1,323.8 million in investing cash flow. The company plans to combine its domestic cellular operations with NYNEX Corporation, with closing expected in mid-1995, and the telephone subsidiaries face growing competition and several state regulatory changes. Shareowners' investment fell to $6,081.3 million from $8,224.4 million, and total assets declined to $24,271.8 million from $29,544.2 million, largely reflecting the regulatory accounting charge. The Form 10-K incorporates much of its MD&A and financial statements by reference to the 1994 Annual Report to shareowners, which is included as Exhibit 13. Cash dividends declared rose to $2.76 per share from $2.68, and operating cash flow was $3,752.6 million, compared with $4,154.8 million in 1993.
Mar 30, 1995
1993-A
VERIZON COMMUNICATIONS INC Annual Report (Amendment), Year Ended Dec 31, 1993
This filing is not a Verizon annual report. Verizon Communications did not exist in 1994, and the document is Amendment No. 1 to Bell Atlantic Corporation's Form 10-K for fiscal 1993 (Commission File No. 1-8606). Its sole purpose is to attach the Form 11-K annual reports for two Bell Atlantic employee savings plans: the Savings Plan for Salaried Employees (BASP) and the Savings and Security Plan for Non-Salaried Employees (BASSP). It contains no corporate-level income statement, balance sheet, or segment disclosure, so it offers limited insight into Bell Atlantic's operating or financial performance. The employee plan data show strong growth in 1993. BASP net assets rose from $1.65 billion to $1.97 billion, and BASSP net assets rose from $920.6 million to $1.14 billion. The main driver was a 15.85% increase in Bell Atlantic's share price, from $51.25 to $59.38, which lifted the value of the company-stock funds. Roughly 41% of BASP assets and 59% of BASSP assets were in Bell Atlantic shares funds. Both plans are leveraged ESOPs, with about $633.7 million of carrying value in Leveraged ESOP notes at 8.17% interest, against an estimated fair value of $707.6 million. For investors, the main points are the concentration of employee retirement assets in Bell Atlantic stock, the modest scale of the ESOP debt relative to plan assets, and one credit risk: the plans hold a $530.6 million contract with Mutual Benefit Life, which is under New Jersey regulatory control and now accrues interest at 3.0%. Because the filing is a plan-level supplement, its information is limited to these employee benefit plans.
Apr 28, 1994
1993
VERIZON COMMUNICATIONS INC Annual Report, Year Ended Dec 31, 1993
Bell Atlantic Corporation's 1993 Form 10-K (filed March 31, 1994) portrays a company whose core telephone business is growing modestly while it repositions for multimedia and wireless opportunities. Reported 1993 operating revenues were $12,990.2 million, up 2.1% (about 4.5% excluding the computer leasing and customer premises equipment dispositions), and operating income rose 11.6% to $2,797.6 million. Net income was $1,403.4 million, or $3.22 per share, versus $3.13 in 1992, a 2.9% gain in reported EPS that management says was nearly 9% excluding one-time and extraordinary items. Results were affected by accounting changes (SFAS 109 and 112) and a 1-point federal tax rate increase. Cash from operations rose to $4.23 billion, and the debt ratio improved to 54.6% from 56.3%. The filing's central strategic theme is the transformation of the Network Services Companies into a segment-focused organization. The company reorganized into nine lines of business, pledged $11 billion over five years to build broadband "information highway" networks, and is pursuing video dial tone and entertainment services after a federal court struck down the 1984 Cable Act's restriction on local carriers providing programming. It is also expanding internationally, notably a $520 million stake in Grupo Iusacell of Mexico, with up to 42% economic interest planned. Management expects Iusacell to dilute earnings by about $0.14 per share in 1994, but views the investment as a major long-term growth driver for its wireless business. Investors should weigh substantial competitive and regulatory risk. The filing warns that long-distance carriers (AT&T via McCaw, MCI with a $2 billion local network plan) and cable operators could erode local exchange revenues, and that PCS auctions and alternative access providers add pressure. Financial services are being exited, with a sale of a significant part of the TriCon leasing business to GFC Financial planned for the second quarter of 1994. The company also disclosed that the planned TCI/Liberty Media merger was terminated in February 1994.
Mar 31, 1994