Verizon added far more wireless subscribers than analysts expected in the third quarter, raised its full-year outlook for the third quarter in a row, and signed a deal worth more than $2 billion to connect Amazon Web Services data centers with fiber. The results, reported Monday, October 26, show a carrier whose consumer business is improving at the same time as its network business finds a second customer in the artificial intelligence buildout.
The headline number was 406,000 postpaid phone net additions in the quarter. Analysts had expected 209,439, according to Visible Alpha figures cited by Reuters, so Verizon added nearly twice as many as forecast. The company said it was its strongest third-quarter phone result in five years, and that phone additions were up more than 820 percent from a year earlier.
Verizon also added 137,000 postpaid accounts, which it called its best quarterly account growth in more than a decade. Broadband grew by 314,000 connections, split between 159,000 fixed wireless additions and 155,000 fiber additions, taking total broadband connections to 17.4 million.
The subscriber gains came with better retention. Postpaid phone churn improved to 0.94 percent, four basis points better than a year earlier. Verizon said the cost of winning new customers through promotions fell 41 percent, and retention costs improved 30 percent.
Chief executive Dan Schulman tied the results to a strategy shift that is now a year old. Verizon launched its Simplicity plan in June, with transparent pricing and unlimited data, and has been cutting back on phone subsidies. “Verizon delivered another record-breaking quarter. One year into our transformation, Verizon is fundamentally stronger — operationally, financially, and competitively,” Schulman said in the company’s release.
On the strength of the quarter, Verizon lifted its full-year guidance again. It now expects 1.1 million to 1.2 million postpaid phone additions for 2026, up from its earlier range of 750,000 to 1 million. It raised its full-year adjusted earnings per share forecast to $5.04 to $5.06, from $4.99 to $5.04.
The quarter’s finances were strong in most lines. Total operating revenue reached $34.3 billion, up 1.5 percent from a year earlier. Operating income rose 6.7 percent to $8.7 billion, and net income rose 5.2 percent to $5.3 billion. Adjusted earnings per share came in at $1.31, up 8.3 percent, against a $1.28 consensus cited by Investing.com. Adjusted earnings before interest, taxes, depreciation, and amortization set a quarterly record at $13.8 billion, up 8 percent, and free cash flow rose 12.1 percent to $7.8 billion.
The second story in the release was the AWS agreement. Valued at more than $2 billion, it sets up a commercial framework under which Verizon will provide high-capacity fiber-optic connectivity for AWS data centers, to move data faster and more reliably for AI computing work. The company described the deal as a way to scale distributed computing for agentic and generative AI workloads.
It is the second such deal Verizon has announced since July. In July, the carrier signed an agreement worth more than $1 billion with Google to connect data centers using dark fiber. Taken together, the two deals point to a new revenue line for telecom operators: renting the fiber that AI data centers need, rather than only selling phone plans. AWS itself has said its cloud capacity is largely sold out through 2027, which helps explain why its data-center connectivity is worth buying.
“Technology leaders are choosing our fiber network to power the next generation of AI infrastructure,” Schulman said.
Not every line beat expectations. Revenue of $34.3 billion fell short of the $34.74 billion analysts had expected, according to LSEG data cited by Reuters. The shortfall came from lower device upgrade volumes: customers are holding on to their phones longer now that Verizon has cut device subsidies, which reduces equipment sales even as it helps margins.
Investors focused on the subscriber beat and the guidance raise. Verizon shares rose 2.4 percent in premarket trading after the release.
