01—Abstract
Summary
Summary of the 10-K filed February 9, 2024. Cited figures are marked; the original filing is the authoritative source.
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 billiona, 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 billionb 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 billionc for 2024.
02—Key points
Key Highlights
- Consolidated operating revenues decreased by 2.1% to $133.97 billion, impacted by lower wireless equipment sales.
- Verizon Consumer Group revenue declined by 1.8% to $101.6 billion, while the Verizon Business Group revenue decreased by 3.1% to $30.1 billion.
- A significant $5.8 billion goodwill impairment charge was recorded for the Business segment due to market pressures and revised financial projections.
- Free cash flow increased to $18.7 billion, driven by operational improvements and lower capital expenditures.
- Capital expenditures for 2024 are projected to be between $17.0 billion and $17.5 billion.
- The company increased its quarterly dividend by 1.9% to $0.6650 per share, marking the seventeenth consecutive annual increase.
- Verizon continues to invest heavily in its 5G network and C-Band spectrum deployment.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2023filed February 9, 2024Financial Statements
FY2023 against FY2022
| Line item | FY2023FY2022 | Change |
|---|---|---|
| Revenue | $133.97B$136.84B | −2.1% |
| SG&A Expenses | $32.74B$30.14B | +8.7% |
| Operating Expenses | $111.10B$106.37B | +4.4% |
| Operating Income | $22.88B$30.47B | −24.9% |
| Interest Expense | $5.52B$3.61B | +52.9% |
| Net Income | $12.10B$21.75B | −44.4% |
| EPS (Basic) | $2.76$5.06 | −45.5% |
| EPS (Diluted) | $2.75$5.06 | −45.7% |
| Shares Outstanding (Basic) | 4.21B4.20B | +0.2% |
| Shares Outstanding (Diluted) | 4.21B4.20B | +0.3% |
05—Questions
Frequently Asked Questions
What was Verizon's overall financial performance in 2023?
Verizon's consolidated operating revenues decreased by 2.1% to $133.97 billion in 2023 compared to 2022. This decline was mainly attributed to lower wireless equipment revenues. However, the company generated a strong free cash flow of $18.7 billion, an increase from the previous year, indicating robust operational cash generation.
What led to the goodwill impairment charge for the Business segment?
Verizon recorded a $5.8 billion goodwill impairment charge for its Business segment primarily due to increased competitive and market pressures, which resulted in lower projected cash flows. Revised five-year strategic planning reviews indicated declines in financial projections compared to prior years, and macroeconomic factors like interest rate and inflationary pressures also impacted the fair value of the reporting unit.
How is Verizon managing its network investments and 5G strategy?
Verizon continues to invest significantly in its network infrastructure, focusing on the deployment of 5G technology and C-Band spectrum. This strategy aims to enhance network capacity, improve performance, and create future growth opportunities. The company anticipates capital expenditures for 2024 to be in the range of $17.0 billion to $17.5 billion, reflecting its ongoing commitment to network evolution.
What is the outlook for Verizon's dividend payments?
Verizon demonstrated its commitment to shareholder returns by increasing its quarterly dividend by 1.9% to $0.6650 per share. This marks the seventeenth consecutive year that the company's Board of Directors has approved a quarterly dividend increase, signaling confidence in sustained financial performance.
06—Continue