Verizon Communications, 5.9% 15 Feb 2054

Strong Q3 operating momentum (customer-first, “revenue-positive” growth): Verizon delivered its best Q3 in years with postpaid phone net adds up ~820% YoY to 406k and postpaid net account adds of 137k (best in 10+ years). No “free line” strategy—Dan emphasized they’re winning on quality and economics, with acquisition costs down 41% YoY and retention costs down 30% YoY, plus churn improvement (postpaid phone churn 94 bps, down 4 bps YoY; consumer postpaid churn 87 bps, down 4 bps).

Guidance raised: higher EPS and cash flow expected in 2026: Tony and Dan raised full-year outlook—adjusted EPS expected to grow 7%–7.5% (up from prior 6%–7%), and free cash flow guidance raised to ~12% growth (up from prior 9%–10%). They also said Q3 free cash flow was $7.8B (highest quarterly since 2020) and expects full-year FCF to be the highest total since 2020. For revenue trajectory, Verizon expects Q4 mobility & broadband service revenue growth to accelerate to ~4% YoY, and full-year mobility & broadband service revenue growth in the upper half of 2.5%–3%.

Broadband mix shift + FWA speed breakthrough (opportunity): Verizon reported 314k broadband net adds with mix shifting toward fiber (fiber ~nearly half of broadband net adds). They continue targeting 32M+ fiber passings by year-end and 40M–50M fiber passings over the medium term plus incremental 10M–15M additional premises with 1-gig FWA (on top of 40M–50M fiber build). Surprising/strategic: Dan highlighted 1 gig FWA using millimeter wave (1,700 MHz) becoming a differentiated competitive advantage and potentially creating capacity efficiencies in existing C-band.