01—Abstract
Summary
Summary of the 10-Q filed April 25, 2024. Cited figures are marked; the original filing is the authoritative source.
Verizon Communications Inc. reported solid first-quarter 2024 results, with total operating revenues remaining stable year-over-year at $33.0 billiona.
The company demonstrated strong operational execution, particularly in its Consumer segment, which saw a revenue increase of 0.8% to $25.1 billionb. This growth was driven by higher wireless service revenues, benefiting from pricing actions and an expanding FWA subscriber base. While the Business segment experienced a slight revenue decline of 1.6% to $7.4 billion, the overall stability in revenue and a focus on cost management underscore Verizon's resilience in a competitive market.
Profitability metrics showed improvement, with net income attributable to Verizon reaching $4.6 billionc, though slightly down from $4.9 billion in the prior year. Diluted Earnings Per Share (EPS) was $1.09, compared to $1.17 in the first quarter of 2023.
Free cash flow generation was robust, increasing to $2.7 billiond from $2.3 billion in the prior year, reflecting disciplined capital expenditures. The company's strategic focus on network modernization and customer retention continues to be a key theme, positioning Verizon for future growth.
02—Key points
Key Highlights
- Total operating revenues were largely flat, increasing by 0.2% to $33.0 billion, indicating stable performance.
- Consumer segment revenue grew by 0.8% to $25.1 billion, driven by increased wireless service revenue and FWA adoption.
- Business segment revenue decreased by 1.6% to $7.4 billion, primarily due to declines in Enterprise and Public Sector.
- Net income attributable to Verizon was $4.6 billion, with Diluted EPS of $1.09, compared to $4.9 billion and $1.17 respectively in the prior year.
- Free cash flow significantly increased by 15.7% to $2.7 billion, reflecting effective capital expenditure management.
- Capital expenditures decreased to $4.4 billion from $6.0 billion in the prior year, primarily due to the completion of accelerated C-Band deployment.
- The company paid $2.8 billion in cash dividends, underscoring its commitment to returning capital to shareholders.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed April 25, 2024Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $32.98B$32.91B | +0.2% |
| SG&A Expenses | $8.14B$7.51B | +8.5% |
| Operating Expenses | $25.46B$25.33B | +0.5% |
| Operating Income | $7.52B$7.58B | −0.8% |
| Interest Expense | $1.64B$1.21B | +35.5% |
| Net Income | $4.60B$4.91B | −6.3% |
| EPS (Basic) | $1.09$1.17 | −6.8% |
| EPS (Diluted) | $1.09$1.17 | −6.8% |
| Shares Outstanding (Basic) | 4.21B4.21B | +0.2% |
| Shares Outstanding (Diluted) | 4.22B4.21B | +0.2% |
05—Questions
Frequently Asked Questions
What was Verizon's revenue performance in Q1 2024, and what drove the changes?
Verizon's total operating revenues remained stable, increasing by 0.2% to $33.0 billion in Q1 2024. The Consumer segment saw a revenue increase of 0.8% to $25.1 billion, primarily due to higher wireless service revenues and growth in Fixed Wireless Access (FWA) subscribers. The Business segment experienced a 1.6% revenue decrease to $7.4 billion, mainly driven by declines in Enterprise and Public Sector offerings.
How did Verizon's profitability metrics fare in the first quarter?
Net income attributable to Verizon was $4.6 billion, a slight decrease from $4.9 billion in the same period last year. Diluted Earnings Per Share (EPS) was $1.09, down from $1.17 in Q1 2023. This was impacted by higher interest expenses and certain operational costs.
What is the outlook for Verizon's capital expenditures and cash flow?
Capital expenditures for Q1 2024 were $4.4 billion, a decrease from $6.0 billion in the prior year, largely due to the nearing completion of the C-Band deployment. This reduction in capex, coupled with stable operating cash flow, led to a significant increase in free cash flow, which grew to $2.7 billion from $2.3 billion in Q1 2023. Management expects capital spending for the full year 2024 to be between $17.0 billion and $17.5 billion.
What is Verizon's current debt situation and its strategy for managing it?
As of March 31, 2024, Verizon's total debt stood at $151.7 billion, with approximately 75% of its debt portfolio being fixed-rate, including the impact of interest rate swaps. The company actively manages its debt through various transactions, including tender offers and open market repurchases. Interest expense increased year-over-year, partly due to higher average interest rates and debt balances, but the company remains compliant with its debt covenants.
06—Continue