Telecommunications giant Verizon (NYSE: VZ) fell short of the market’s revenue expectations in Q2 CY2026, with sales flat year on year at $34.25 billion. Its non-GAAP profit of $1.30 per share was 2.7% above analysts’ consensus estimates.

Is now the time to buy VZ? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

Verizon’s second quarter was met with a positive market reaction, despite revenue coming in below Wall Street expectations. Management credited improved customer additions and reduced churn for the company’s solid operational performance. CEO Dan Schulman highlighted that postpaid phone net additions reached the highest level in five years and attributed the improvement to Verizon’s updated customer value proposition and disciplined cost management. The company also noted early progress in cross-selling broadband and mobility services, with Schulman stating, “Our net adds for Q2 were over 550,000, and we are now growing both accounts and lines.”

Looking ahead, Verizon’s leadership pointed to further acceleration in mobility and broadband revenue, as well as meaningful contributions from new AI infrastructure deals. Schulman outlined that the recently launched loyalty program and simplified plans are expected to enhance customer retention and acquisition. Additionally, Verizon anticipates incremental revenue from its partnership with Google for dark fiber, as the company seeks to address rising demand for data center connectivity. CFO Tony Skiadas emphasized, “AI infrastructure represents a large opportunity with a new long-term, high-quality revenue stream that we expect to ramp over the next few years.”

Key Insights from Management’s Remarks

Management attributed recent performance to lower churn, improved customer acquisition economics, and the launch of new programs aimed at driving sustained growth, while also emphasizing new revenue streams from AI infrastructure partnerships.

• Customer churn improvement: Verizon’s consumer postpaid phone churn declined to 0.84%, a notable reversal from previous rising trends, as efforts to improve service and reduce customer pain points began to take effect. Management stressed that lower churn, combined with lower acquisition and retention costs, became a key engine for earnings growth.
• Launch of new loyalty program: The mid-June introduction of a comprehensive loyalty program, offering monthly cash back and a fee-free experience for all customers, was designed to increase customer satisfaction and stickiness. Early results exceeded internal expectations, with strong uptake across diverse customer segments.
• Simplified wireless plan rollout: The new “Simplicity” wireless plan, featuring transparent pricing and no device subsidies, was introduced to streamline offerings and improve margins. Management reported this approach has already led to higher average revenue per account (ARPA) and more subsidy-free account growth.
• AI infrastructure monetization: Verizon announced a $1 billion dark fiber agreement with Google and highlighted ongoing discussions with other hyperscalers. These long-term, contracted deals are expected to create a new, high-quality revenue stream, with management describing them as “just the beginning” of Verizon’s expansion into AI-driven network connectivity.
• Cost transformation initiatives: Ongoing operational efficiency projects, including the integration of Frontier assets and AI-centric transformation workstreams, are on track to deliver at least $9 billion in OpEx and CapEx savings. Management sees these efforts as a multi-year tailwind supporting future margin expansion and capital flexibility.

Drivers of Future Performance

Verizon’s outlook is shaped by ongoing improvements in customer retention, new product initiatives, and anticipated growth in AI infrastructure services, all of which underpin management’s confidence in sustained revenue and margin expansion.

• Impact of new customer offerings: The rollout of the loyalty program and Simplicity plan is expected to drive incremental account growth, reduce churn, and increase ARPA, resulting in a healthier revenue base and improved profitability. Management believes these initiatives provide structural advantages in customer economics.
• AI infrastructure as growth lever: Management highlighted the multi-year potential of AI Connect, which leverages Verizon’s extensive fiber network to serve hyperscalers and data center operators. Early wins, such as the Google dark fiber deal, position Verizon to capitalize on the accelerating demand for data connectivity required by artificial intelligence applications.
• Cost and margin discipline: Ongoing efficiency programs are set to deliver substantial operating and capital cost savings, supporting higher margins and enhanced free cash flow. Management expects these savings to offset headwinds from legacy promotional amortization and enable continued investments in network and product development.

Catalysts in Upcoming Quarters

Going forward, the StockStory team will monitor (1) the pace of adoption and effectiveness of Verizon’s new loyalty and Simplicity programs, (2) the ramp-up of revenue from AI infrastructure partnerships and further contract announcements, and (3) ongoing progress in cost transformation efforts, particularly integration with Frontier and realization of targeted synergies. Execution in these areas will be critical for sustaining growth and margin improvements.

Verizon currently trades at $46.25, up from $43.95 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).

Stocks That Trumped Tariffs

ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.

Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.

Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.