Verizon's Third Quarter 2023 Performance
Verizon Communications Inc. unveiled its financial results for the third quarter of 2023, shedding light on the company's performance in various sectors. The company's consolidated earnings per share (EPS) stood at $1.13, marking a decline from $1.17 in the third quarter of 2022. Adjusted for special items, the EPS was $1.22, compared to $1.32 in the same period the previous year. Total operating revenue for the quarter amounted to $33.3 billion, reflecting a 2.6% decrease from the third quarter of 2022. Despite these declines, Verizon's broadband sector saw significant growth, with net additions of 434,000. This marks the fourth consecutive quarter where the company reported over 400,000 broadband net additions. The wireless sector also witnessed growth, with total wireless service revenue reaching $19.3 billion, a 2.9% increase year over year.
Management Commentary and Forward Guidance
Verizon's Chairman and CEO, Hans Vestberg, commented on the company's Q3 performance, emphasizing the continued growth in wireless service revenue, total broadband net additions, and the improvement in profitability. Vestberg highlighted the company's financial discipline and robust balance sheet, which facilitated the increase in dividends for the 17th consecutive year, setting a record in the U.S. telecom industry. Looking ahead, Verizon has raised its free cash flow guidance for 2023, now expecting it to exceed $18 billion, a $1 billion increment from the previous forecast. The company also anticipates total wireless service revenue growth of 2.5% to 4.5%, adjusted EBITDA ranging from $47.0 billion to $48.5 billion, and an adjusted EPS between $4.55 to $4.85 for the year.
Financial Metrics and Year-over-Year Comparison:
- EPS: $1.13 in Q3 2023, down from $1.17 in Q3 2022 (a decrease of 3.4%).
- Adjusted EPS: $1.22 in Q3 2023, compared to $1.32 in Q3 2022 (a decrease of 7.6%).
- Total Operating Revenue: $33.3 billion in Q3 2023, down 2.6% from Q3 2022.
- Net Income: $4.9 billion, a decrease of 2.8% from Q3 2022.
- Consolidated Adjusted EBITDA: $12.2 billion, a slight increase of 0.2% year over year.
- Year-to-Date Cash Flow from Operations: $28.8 billion, up from $28.2 billion in 2022 (an increase of 2.1%).
- Free Cash Flow Year-to-Date: $14.6 billion, up from $12.4 billion in 2022 (an increase of 17.7%).
Verizon (VZ.US) shares are up over 8.0% today after the quarterly results. The price has broken above the upper limit of the descending triangle. After solid results, the management remains optimistic about 2024. If the sentiment extends, it's possible that the shares will test the next resistance level at $36.8.
