VERIZON COMMUNICATIONS INC Quarterly Report for Q3 Ended Sep 30, 2015

Summary

Verizon Communications Inc. (VZ) reported strong third-quarter 2015 results, demonstrating resilience and strategic growth. Total operating revenues increased to $33.2 billion, up 5.0% year-over-year, driven by robust performance in the Wireless segment, particularly from increased wireless equipment revenues due to the growing adoption of device payment programs. The Wireline segment saw a slight revenue decline, but growth in Fios services provided some offset. Net income attributable to Verizon rose to $4.0 billion ($0.99 per diluted share) from $3.7 billion ($0.89 per diluted share) in the prior year's third quarter. The company also executed significant strategic transactions during the period, including the acquisition of AOL Inc. for $3.7 billion to bolster digital media and advertising capabilities, and the purchase of significant AWS-3 spectrum licenses for $10.4 billion to strengthen its wireless network. Despite these investments and ongoing capital expenditures, Verizon generated substantial free cash flow, indicating strong operational performance and financial discipline.

Key Highlights

• 1Total operating revenues for Q3 2015 increased by 5.0% to $33.2 billion, driven by a 5.4% increase in Wireless revenues.
• 2Wireless equipment revenues saw a significant jump of 73.1% due to the increasing popularity of device payment programs.
• 3Net income attributable to Verizon increased to $4.0 billion, with diluted EPS rising to $0.99 from $0.89 in the prior year.
• 4The company completed the acquisition of AOL Inc. for $3.7 billion, aiming to expand its digital content and advertising platform.
• 5Verizon invested $10.4 billion in AWS-3 spectrum licenses to enhance its wireless network capabilities.
• 6Free cash flow for the nine months ended September 30, 2015, increased by 50.8% to $15.9 billion, demonstrating strong cash generation.

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