VZ
$57.80
Verizon Communications
$.82
1.44%
Earnings Details
Quarter December 2019
Thursday, January 30, 2020 7:00:00 AM
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Summary

Verizon Communications Misses

Verizon Communications (VZ) reported Quarter December 2019 earnings of $1.13 per share on revenue of $34.8 billion. The consensus earnings estimate was $1.15 per share on revenue of $34.5 billion. The Earnings Whisper number was $1.15 per share. Revenue grew 1.4% on a year-over-year basis.

The company said it expects 2020 earnings of $4.91 to $5.00 per share. The current consensus earnings estimate is $4.95 per share for the year ending December 31, 2020.

Verizon Communications Inc is a provider of communications, information and entertainment products and services to consumers, businesses and governmental agencies. Its two segments are Wireless and Wireline.

Results
Reported Earnings
$1.13
Earnings Whisper
$1.15
Consensus Estimate
$1.15
Reported Revenue
$34.78 Bil
Revenue Estimate
$34.53 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Verizon ends 2019 with highest 4Q wireless adds in six years, increased cash flow and revenue growth

4Q 2019 highlights

Consolidated:

  • $1.23 in earnings per share (EPS), compared with $0.47 in 4Q 2018; adjusted EPS (non-GAAP), excluding special items, of $1.13, compared with $1.12 in 4Q 2018.
  • Operating revenue growth of 1.4 percent from fourth-quarter 2018.

Consumer:

  • Total revenue of $24.2 billion, an increase of 2.0 percent year over year.
  • 852,000 retail postpaid net additions, including 588,000 phone net additions, up 12.6 percent year over year, and 723,000 postpaid smartphone net additions.
  • Total retail postpaid churn of 1.09 percent, and retail postpaid phone churn of 0.83 percent.
  • 35,000 Fios Internet net additions.

Business:

  • Total revenue of $8.1 billion, an increase of 0.8 percent year over year.
  • 396,000 retail postpaid net additions, including 202,000 phone net additions.
  • Total retail postpaid churn of 1.28 percent, and retail postpaid phone churn of 1.00 percent.

Wireless (non-GAAP):

  • Total revenue growth of 3.5 percent year over year to $25.3 billion in fourth-quarter 2019, driven by a 2.7 percent increase in service revenue. For full-year 2019, Wireless service revenue grew 3.2 percent.
  • 1.2 million retail postpaid net additions, including 790,000 phone net additions, the highest fourth-quarter phone net additions in six years; and 969,000 postpaid smartphone net additions, up 11.0 percent year over year.
  • 1.4 million phone net additions in full-year 2019, compared to 1.1 million in full-year 2018.
  • Total retail postpaid churn of 1.13 percent, and retail postpaid phone churn of 0.86 percent.

Wireline (non-GAAP):

  • Total revenue of $7.1 billion, a decrease of 4.1 percent year over year.
  • 39,000 Fios Internet net additions; Fios total revenue growth of 0.8 percent year over year.

2019 highlights

Consolidated:

  • Full year EPS of $4.65, compared with $3.76 in 2018; adjusted EPS (non-GAAP), excluding special items, of $4.81, compared with 2018 adjusted EPS of $4.71.
  • Full-year 2019 operating cash flow of $35.7 billion, an increase from $34.3 billion in 2018.
  • Free cash flow (non-GAAP) of $17.8 billion in full-year 2019, up 0.7 percent year over year.
  • Unsecured debt is lower by $3.9 billion from year-end 2018.

NEW YORK, Jan. 30, 2020 (GLOBE NEWSWIRE) -- Verizon Communications Inc. (NYSE, Nasdaq: VZ) closed 2019 with strong fourth-quarter results highlighted by earnings growth and the most fourth-quarter phone net additions in six years. 

"Verizon delivered strong operational performance in the fourth quarter, highlighted by continued wireless customer growth in both Consumer and Business," said Chairman and CEO Hans Vestberg. "In 2019, Verizon drove innovation in 5G, established a new operating structure and delivered solid financial results. We entered 2020 with great momentum as we expand our network leadership and remain focused on the customer to provide a best-in-class experience. Our 5G footprint continues to grow as we lead this era of transformational change by building these next-generation networks the right way."

For fourth-quarter 2019, Verizon reported EPS of $1.23, compared with $0.47 in fourth-quarter 2018. On an adjusted basis (non-GAAP), fourth-quarter 2019 EPS, excluding special items, was $1.13, compared with adjusted EPS of $1.12 in fourth-quarter 2018.

Fourth-quarter 2019 EPS included a net pre-tax loss from special items of about $2.4 billion, which consisted of an early debt extinguishment charge of $2.1 billion, an impairment charge of $236 million primarily related to the write-down of goodwill in the Media business, and a net charge related to severance and annual mark-to-market for pension and OPEB (other post-employment benefits) liabilities of $135 million. The company also recorded a $2.2 billion tax benefit related to the sale of preferred shares in a foreign affiliate. The cash impact related to the tax benefit of this sale will be realized in 2020.

In fourth-quarter 2019, Verizon's results included the effects of a reduction in benefits from the adoption of a revenue recognition standard, primarily due to the deferral of commission expense, and the adoption of a lease accounting standard. The combined net impact was a 4 cent headwind in fourth-quarter 2019, and 17 cents for full-year 2019, which is included in the year-over-year increase in adjusted EPS.

For full-year 2019, Verizon reported $4.65 in EPS, compared with $3.76 in full-year 2018. On an adjusted basis (non-GAAP), excluding special items, 2019 EPS was $4.81, compared with 2018 EPS of $4.71.

Consolidated results

Total consolidated operating revenues in fourth-quarter 2019 were $34.8 billion, up 1.4 percent from fourth-quarter 2018. This growth was primarily driven by higher wireless service revenue, highlighted by volumes and step-ups in access, partially offset by lower wireless equipment revenue and declines in revenue from wireline products and services, predominantly in the Business segment. Full-year 2019 consolidated operating revenues were $131.9 billion, up 0.8 percent year over year.

Cash flow from operations totaled $35.7 billion in 2019, an increase from $34.3 billion in 2018. This growth was the result of operational improvements in Verizon's businesses and lower discretionary employee benefit contributions, partially offset by higher cash tax payments and cash payments related to the Voluntary Separation Program.

Full-year 2019 capital expenditures were $17.9 billion. Capital expenditures continue to support the launch and build-out of Verizon's 5G Ultra Wideband network, the growth in data and video traffic on the company's 4G LTE network, the deployment of significant fiber in markets nationwide and the upgrade to Verizon's Intelligent Edge Network architecture.

The company's unsecured debt decreased by $3.9 billion in 2019. The company remains focused on reducing its net unsecured debt portfolio into its targeted range of 1.75 to 2.0 times, while continuing to actively manage its near-term maturities, optimize its overall funding footprint and lower its cost of capital.  With leverage nearing the high end of the targeted range, the company is adding share repurchases as a fourth priority to the capital allocation policy. Repurchases would begin after the company's other priorities have been met, including investment in the business, commitment to the dividend and strengthening of the balance sheet.

In 2018, Verizon announced a goal to achieve $10 billion in cumulative cash savings by 2021. This initiative has yielded $5.7 billion of cumulative cash savings since the program began and is on track to achieve its target. For full-year 2019, Verizon realized approximately $1.3 billion in expense savings from the Voluntary Separation Program.

Net income was $5.2 billion in fourth-quarter 2019. EBITDA (non-GAAP, earnings before interest, taxes, depreciation and amortization) totaled approximately $9.0 billion. Consolidated operating income margin was 19.1 percent in fourth-quarter 2019, compared with 1.9 percent in fourth-quarter 2018. Consolidated EBITDA margin (non-GAAP) was 25.8 percent in fourth-quarter 2019, compared with 20.2 percent in fourth-quarter 2018. Adjusted EBITDA margin (non-GAAP) in fourth-quarter 2019 was 32.0 percent, and consolidated adjusted EBITDA (non-GAAP) in fourth-quarter 2019 was $11.1 billion.

Consumer results

  • Total Verizon Consumer revenues were $24.2 billion, an increase of 2.0 percent year over year, driven by continued strong growth in wireless and Fios service offerings, offset by declines in wireless equipment revenue and copper-based wireline services. For full-year 2019, total Consumer revenues were $91.1 billion, an increase of 1.4 percent from full-year 2018.

  • Consumer reported 852,000 wireless retail postpaid net additions in fourth-quarter 2019. This consisted of 588,000 phone net additions, up 12.6 percent year over year, and 305,000 other connected device net additions, primarily wearables, partially offset by tablet net losses of 41,000. Postpaid smartphone net additions were 723,000.

  • Consumer wireless service revenues were $13.4 billion in fourth-quarter 2019, a 1.9 percent increase year over year, driven by customer step-ups to unlimited and higher-priced tiers and an increase in connections per account. Full-year 2019 wireless service revenues were $53.8 billion, a 2.5 percent increase year over year.

  • Total retail postpaid churn was 1.09 percent in fourth-quarter 2019, and retail postpaid phone churn was 0.83 percent.

  • Consumer reported 35,000 Fios Internet net additions and 51,000 Fios Video net losses in fourth-quarter 2019, reflecting the ongoing shift from traditional linear video to over-the-top offerings. Consumer Fios revenues remained relatively flat, primarily due to the demand for broadband offerings, offset by the impact of video subscriber losses.

  • In fourth-quarter 2019, segment operating income was $6.9 billion, an increase of 1.2 percent year over year, and segment operating income margin was 28.4 percent. Full-year 2019 segment operating income margin was 31.8 percent, compared with 31.2 percent in full-year 2018. Segment EBITDA (non-GAAP) totaled $9.7 billion in fourth-quarter 2019, a decrease of 1.2 percent year over year. Segment EBITDA margin (non-GAAP) was 39.9 percent in fourth-quarter 2019, down from 41.2 percent in fourth-quarter 2018. For the full year, segment EBITDA margin (non-GAAP) was 44.3 percent in 2019, compared with 44.5 percent in 2018. On a year over year basis, headwinds from the deferral of commission expense and the lease accounting standard accounted for approximately 80 basis points for the quarter.

Business results

  • Total Verizon Business revenues were $8.1 billion, up approximately 1.0 percent year over year. For full-year 2019, total Verizon Business revenues were $31.4 billion, a decrease of 0.3 percent from full-year 2018.

  • Business reported 396,000 wireless retail postpaid net additions in fourth-quarter 2019, an increase of 18.6 percent year over year. This consisted of 202,000 phone net additions, 132,000 tablet net additions and 62,000 other connected device additions.

  • Total retail postpaid churn was 1.28 percent in fourth-quarter 2019, and retail postpaid phone churn was 1.00 percent.

  • In fourth-quarter 2019, segment operating income was $666 million, a decrease of 16.6 percent year over year, and segment operating income margin was 8.3 percent. Full-year 2019 segment operating income margin was 12.0 percent, compared with 13.2 percent in full-year 2018. Segment EBITDA (non-GAAP) totaled $1.7 billion in fourth-quarter 2019, a decrease of 10.4 percent year over year. Segment EBITDA margin (non-GAAP) was 20.7 percent, down from 23.3 percent in fourth-quarter 2018, due in part to declines in high margin wholesale revenue. For the full year, segment EBITDA margin (non-GAAP) was 25.0 percent in 2019, compared with 26.7 percent in 2018. On a year over year basis, headwinds from the deferral of commission expense and the lease accounting standard accounted for approximately 50 basis points for the quarter.

Media results

  • Total Verizon Media revenues in fourth-quarter 2019 were $2.1 billion, nearly flat year over year. This is a meaningful improvement from the decline reported at the beginning of the year. Gains in native advertising and the demand-side platform continue to be offset by declines in legacy desktop search revenue streams.

Outlook and guidance

For 2020, Verizon expects the following:

  • Adjusted EPS growth (non-GAAP) of 2 to 4 percent.

  • Low-to-mid single-digit percentage growth in consolidated revenues compared to full-year 2019.

  • Capital spending to be in the range of $17 billion to $18 billion, including the expansion of 5G in new and existing markets, the densification of 4G, and the continuation of the fiber build-out.   

  • Adjusted effective income tax rate (non-GAAP) in the range of 23 percent to 25 percent.

NOTE: See the accompanying schedules and www.verizon.com/about/investors for reconciliations to generally accepted accounting principles (GAAP) for non-GAAP financial measures cited in this document.

Verizon Communications Inc. (NYSE, Nasdaq: VZ) was formed on June 30, 2000 and is celebrating its 20th year as one of the world’s leading providers of technology, communications, information and entertainment products and services. Headquartered in New York City and with a presence around the world, Verizon generated revenues of $131.9 billion in 2019. The company offers voice, data and video services and solutions on its award winning networks and platforms, delivering on customers’ demand for mobility, reliable network connectivity, security and control.

VERIZON’S ONLINE MEDIA CENTER: News releases, stories, media contacts and other resources are available at www.verizon.com/about/news/. News releases are also available through an RSS feed. To subscribe, visit www.verizon.com/about/rss-feeds/.

Forward-looking statements
In this communication we have made forward-looking statements. These statements are based on our estimates and assumptions and are subject to risks and uncertainties. Forward-looking statements include the information concerning our possible or assumed future results of operations. Forward-looking statements also include those preceded or followed by the words “anticipates,” “believes,” “estimates,” “expects,” “hopes” or similar expressions. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. The following important factors, along with those discussed in our filings with the Securities and Exchange Commission (the “SEC”), could affect future results and could cause those results to differ materially from those expressed in the forward-looking statements: adverse conditions in the U.S. and international economies; the effects of competition in the markets in which we operate; material changes in technology or technology substitution; disruption of our key suppliers’ provisioning of products or services; changes in the regulatory environment in which we operate, including any increase in restrictions on our ability to operate our networks; breaches of network or information technology security, natural disasters, terrorist attacks or acts of war or significant litigation and any resulting financial impact not covered by insurance; our high level of indebtedness; an adverse change in the ratings afforded our debt securities by nationally accredited ratings organizations or adverse conditions in the credit markets affecting the cost, including interest rates, and/or availability of further financing; material adverse changes in labor matters, including labor negotiations, and any resulting financial and/or operational impact; significant increases in benefit plan costs or lower investment returns on plan assets; changes in tax laws or treaties, or in their interpretation; changes in accounting assumptions that regulatory agencies, including the SEC, may require or that result from changes in the accounting rules or their application, which could result in an impact on earnings; the inability to implement our business strategies; and the inability to realize the expected benefits of strategic transactions.

Media contacts:
Kim Ancin
908.559.3227
kimberly.ancin@verizon.com
 
Eric Wilkens
908.559.3063
eric.wilkens@verizon.com



Verizon Communications Inc.            
Condensed Consolidated Statements of Income 
    
             
       (dollars in millions, except per share amounts)
  3 Mos. Ended 3 Mos. Ended   12 Mos. Ended 12 Mos. Ended  
Unaudited 12/31/19 12/31/18 % Change 12/31/19 12/31/18 % Change
             
Operating Revenues            
Service revenues and other $28,004  $27,460  2.0 $110,305  $108,605  1.6
Wireless equipment revenues  6,771   6,821  (0.7)  21,563   22,258  (3.1)
Total Operating Revenues  34,775   34,281  1.4  131,868   130,863  0.8
             
Operating Expenses            
Cost of services  8,376   8,163  2.6  31,772   32,185  (1.3)
Cost of wireless equipment  7,255   7,128  1.8  22,954   23,323  (1.6)
Selling, general and administrative expense  8,214   9,410  (12.7)  29,896   31,083  (3.8)
Depreciation and amortization expense  4,105   4,352  (5.7)  16,682   17,403  (4.1)
Media goodwill impairment  186   4,591  (95.9)  186   4,591  (95.9)
Total Operating Expenses  28,136   33,644  (16.4)  101,490   108,585  (6.5)
             
Operating Income  6,639   637  *  30,378   22,278  36.4
Equity in earnings (losses) of unconsolidated businesses  5   64  (92.2)  (15)  (186) (91.9)
Other income (expense), net  (1,773)  1,865  *  (2,900)  2,364  *
Interest expense  (1,159)  (1,199) (3.3)  (4,730)  (4,833) (2.1)
Income Before (Provision) Benefit For Income Taxes  3,712   1,367  *  22,733   19,623  15.8
(Provision) benefit for income taxes  1,505   698  *  (2,945)  (3,584) (17.8)
Net Income $5,217  $2,065  * $19,788  $16,039  23.4
             
             
Net income attributable to noncontrolling interests $122  $126  (3.2) $523  $511  2.3
Net income attributable to Verizon  5,095   1,939  *  19,265   15,528  24.1
Net Income $5,217  $2,065  * $19,788  $16,039  23.4
             
             
Basic Earnings Per Common Share            
Net income attributable to Verizon $1.23  $0.47  * $4.66  $3.76  23.9
Weighted-average shares outstanding (in millions)  4,139   4,137     4,138   4,128   
             
Diluted Earnings Per Common Share (1)            
Net income attributable to Verizon $1.23  $0.47  * $4.65  $3.76  23.7
Weighted-average shares outstanding (in millions)  4,141   4,141     4,140   4,132   
             
Footnotes:             
(1) Diluted Earnings per Common Share includes the dilutive effect of shares issuable under our stock-based compensation plans, which represents the only potential dilution.
* Not meaningful            
             
     
             



Verizon Communications Inc.   
Condensed Consolidated Balance Sheets   
        
        
      (dollars in millions) 
Unaudited12/31/19 12/31/18 $ Change 
        
Assets       
Current assets       
Cash and cash equivalents $2,594  $2,745  $(151) 
Accounts receivable, net  25,429   25,102   327  
Inventories  1,422   1,336   86  
Prepaid expenses and other  8,028   5,453   2,575  
Total current assets  37,473   34,636   2,837  
        
Property, plant and equipment  265,734   252,835   12,899  
Less accumulated depreciation  173,819   163,549   10,270  
Property, plant and equipment, net  91,915   89,286   2,629  
Investments in unconsolidated businesses  558   671   (113) 
Wireless licenses  95,059   94,130   929  
Goodwill  24,389   24,614   (225) 
Other intangible assets, net  9,498   9,775   (277) 
Operating lease right-of-use assets  22,694      22,694  
Other assets  10,141   11,717   (1,576) 
Total assets $291,727  $264,829  $26,898  
        
Liabilities and Equity       
Current liabilities       
Debt maturing within one year $10,777  $7,190  $3,587  
Accounts payable and accrued liabilities  21,806   22,501   (695) 
Current operating lease liabilities  3,261      3,261  
Other current liabilities  9,024   8,239   785  
Total current liabilities  44,868   37,930   6,938  
        
Long-term debt  100,712   105,873   (5,161) 
Employee benefit obligations  17,952   18,599   (647) 
Deferred income taxes  34,703   33,795   908  
Non-current operating lease liabilities  18,393      18,393  
Other liabilities  12,264   13,922   (1,658) 
Total long-term liabilities  184,024   172,189   11,835  
        
Equity       
Common stock  429   429     
Additional paid in capital  13,419   13,437   (18) 
Retained earnings  53,147   43,542   9,605  
Accumulated other comprehensive income  998   2,370   (1,372) 
Common stock in treasury, at cost  (6,820)  (6,986)  166  
Deferred compensation – employee stock ownership plans and other  222   353   (131) 
Noncontrolling interests  1,440   1,565   (125) 
Total equity  62,835   54,710   8,125  
Total liabilities and equity $291,727  $264,829  $26,898  
        
        
Consolidated - Selected Financial and Operating Statistics 
(dollars in millions, except per share amounts)   
        
Unaudited12/31/19 12/31/18   
        
Total debt $111,489  $113,063    
Net debt $108,895  $110,318    
Net unsecured debt $96,526  $100,242    
Net debt / Consolidated Adjusted EBITDA(1) 2.3x 2.3x   
Net unsecured debt / Consolidated Adjusted EBITDA(1) 2.0x 2.1x   
Common shares outstanding end of period (in millions)  4,136   4,132    
Total employees (‘000)  135.0   144.5    
Quarterly cash dividends declared per common share $0.6150  $0.6025    
        
Footnotes:       
(1) Consolidated adjusted EBITDA excludes the effects of non-operational items and special items.   
        



Verizon Communications Inc.     
Condensed Consolidated Statements of Cash Flows 
       
       
    (dollars in millions)
  12 Mos. Ended 12 Mos. Ended  
Unaudited12/31/19 12/31/18 $ Change
       
Cash Flows from Operating Activities      
Net Income $19,788  $16,039  $3,749 
Adjustments to reconcile net income to net cash provided by operating activities:      
Depreciation and amortization expense  16,682   17,403   (721)
Employee retirement benefits  (284)  (2,657)  2,373 
Deferred income taxes  1,232   389   843 
Provision for uncollectible accounts  1,588   980   608 
Equity in losses of unconsolidated businesses, net of dividends received  74   231   (157)
Net loss on sale of divested businesses  94      94 
Media goodwill impairment  186   4,591   (4,405)
Changes in current assets and liabilities, net of effects from acquisition/disposition of businesses  (6,713)  (1,177)  (5,536)
Discretionary employee benefits contributions  (300)  (1,679)  1,379 
Other, net  3,399   219   3,180 
Net cash provided by operating activities  35,746   34,339   1,407 
       
Cash Flows from Investing Activities      
Capital expenditures (including capitalized software)  (17,939)  (16,658)  (1,281)
Acquisitions of businesses, net of cash acquired  (29)  (230)  201 
Acquisitions of wireless licenses  (898)  (1,429)  531 
Proceeds from dispositions of businesses  28      28 
Other, net  1,257   383   874 
Net cash used in investing activities  (17,581)  (17,934)  353 
       
Cash Flows from Financing Activities      
Proceeds from long-term borrowings  10,079   5,967   4,112 
Proceeds from asset-backed long-term borrowings  8,576   4,810   3,766 
Repayments of long-term borrowings and finance lease obligations  (17,584)  (10,923)  (6,661)
Repayments of asset-backed long-term borrowings  (6,302)  (3,635)  (2,667)
Dividends paid  (10,016)  (9,772)  (244)
Other, net  (2,917)  (1,824)  (1,093)
Net cash used in financing activities  (18,164)  (15,377)  (2,787)
       
Increase in cash, cash equivalents and restricted cash  1   1,028   (1,027)
Cash, cash equivalents and restricted cash, beginning of period  3,916   2,888   1,028 
Cash, cash equivalents and restricted cash, end of period $3,917  $3,916  $1 
       



Verizon Communications Inc.           
Consumer - Selected Financial Results
             
             
             
       (dollars in millions)
             
  3 Mos. Ended 3 Mos. Ended   12 Mos. Ended 12 Mos. Ended  
Unaudited12/31/19 12/31/18 % Change 12/31/19 12/31/18 % Change
             
Operating Revenues            
Service $16,341  $16,157  1.1 $65,383  $64,223  1.8
Wireless equipment  5,722   5,846  (2.1)  18,048   18,875  (4.4)
Other  2,144   1,730  23.9  7,625   6,664  14.4
Total Operating Revenues  24,207   23,733  2.0  91,056   89,762  1.4
             
Operating Expenses            
Cost of services  4,123   3,870  6.5  15,884   15,335  3.6
Cost of wireless equipment  5,877   5,815  1.1  18,219   18,763  (2.9)
Selling, general and administrative expense  4,549   4,275  6.4  16,639   15,701  6.0
Depreciation and amortization expense  2,772   2,970  (6.7)  11,353   11,952  (5.0)
Total Operating Expenses  17,321   16,930  2.3  62,095   61,751  0.6
             
Operating Income $6,886  $6,803  1.2 $28,961  $28,011  3.4
Operating Income Margin  28.4%  28.7%    31.8%  31.2%  
             
Segment EBITDA $9,658  $9,773  (1.2) $40,314  $39,963  0.9
Segment EBITDA Margin  39.9%  41.2%    44.3%  44.5%  
             
             
Footnotes:           
The segment financial results and metrics above are adjusted to exclude the effects of special items, as the Company’s chief operating decision maker excludes these items in assessing segment performance.
            
Certain intersegment transactions with corporate entities have not been eliminated.  
             



Verizon Communications Inc.           
Consumer - Selected Operating Statistics
             
             
            
             
Unaudited      12/31/19 12/31/18 % Change
             
Connections (‘000):            
Wireless retail postpaid connections        90,481   89,861  0.7
Wireless retail prepaid connections        4,063   4,646  (12.5)
Total wireless retail connections        94,544   94,507  
             
Fios video connections        4,152   4,377  (5.1)
Fios Internet connections        5,902   5,760  2.5
Fios digital voice residence connections        3,620   3,803  (4.8)
Fios digital connections        13,674   13,940  (1.9)
Broadband connections        6,467   6,460  0.1
Voice connections        5,754   6,332  (9.1)
             
             
  3 Mos. Ended 3 Mos. Ended   12 Mos. Ended 12 Mos. Ended  
Unaudited12/31/19 12/31/18 % Change 12/31/19 12/31/18 % Change
             
Gross Additions (‘000):            
Wireless retail postpaid  3,794   3,643  4.1  12,253   11,744  4.3
             
Net Additions Detail (‘000):            
Wireless retail postpaid (1)  852   886  (3.8)  970   1,129  (14.1)
Wireless retail prepaid (1)  (121)  (90) (34.4)  (591)  (757) 21.9
Total wireless retail (1)  731   796  (8.2)  379   372  1.9
             
Wireless retail postpaid phones (1)  588   522  12.6  737   498  48.0
             
Fios video  (51)  (46) (10.9)  (225)  (171) (31.6)
Fios Internet  35   49  (28.6)  141   195  (27.7)
Fios digital voice residence  (52)  (30) (73.3)  (182)  (102) (78.4)
Fios digital  (68)  (27) *  (266)  (78) *
Broadband  (2)  8  *  7   19  (63.2)
Voice  (150)  (148) (1.4)  (578)  (596) 3.0
             
Churn Rate:            
Wireless retail postpaid  1.09%  1.03%    1.05%  1.00%  
Wireless retail postpaid phones  0.83%  0.77%    0.79%  0.76%  
Wireless retail  1.30%  1.24%    1.28%  1.25%  
             
Revenue Statistics (in millions):            
Wireless service revenue $13,445  $13,199  1.9 $53,791  $52,459  2.5
Fios revenues $2,828  $2,820  0.3 $11,175  $11,056  1.1
             
Other Wireless Statistics:            
Wireless retail postpaid ARPA (2) $118.03  $115.87  1.9 $118.13  $115.48  2.3
Wireless retail postpaid upgrade rate  6.3%  6.6%        
Wireless retail postpaid accounts (‘000) (3)        33,875   34,086  (0.6)
Wireless retail postpaid connections per account (3)        2.67   2.64  1.1
Total wireless Internet postpaid base (3)        16.2%  16.1%  
             
             
             
Footnotes:           
(1) Connection net additions include certain adjustments.            
(2) Wireless retail postpaid ARPA - average service revenue per account from retail postpaid accounts.      
(3) Statistics presented as of end of period.            
             
Certain intersegment transactions with corporate entities have not been eliminated.
             
* Not meaningful            
             



Verizon Communications Inc.           
Business - Selected Financial Results  
             
             
             
         (dollars in millions)
             
  3 Mos. Ended 3 Mos. Ended   12 Mos. Ended 12 Mos. Ended  
Unaudited12/31/19 12/31/18 % Change 12/31/19 12/31/18 % Change
             
Operating Revenues            
Global Enterprise $2,740  $2,785  (1.6) $10,818  $11,201  (3.4)
Small and Medium Business  3,072   2,847  7.9  11,464   10,752  6.6
Public Sector and Other  1,487   1,511  (1.6)  5,922   5,833  1.5
Wholesale  772   864  (10.6)  3,239   3,748  (13.6)
Total Operating Revenues  8,071   8,007  0.8  31,443   31,534  (0.3)
             
Operating Expenses            
Cost of services  2,817   2,832  (0.5)  10,655   10,859  (1.9)
Cost of wireless equipment  1,377   1,313  4.9  4,733   4,560  3.8
Selling, general and administrative expense  2,204   1,995  10.5  8,188   7,689  6.5
Depreciation and amortization expense  1,007   1,068  (5.7)  4,105   4,258  (3.6)
Total Operating Expenses  7,405   7,208  2.7  27,681   27,366  1.2
             
Operating Income $666  $799  (16.6) $3,762  $4,168  (9.7)
Operating Income Margin  8.3%  10.0%    12.0%  13.2%  
             
Segment EBITDA $1,673  $1,867  (10.4) $7,867  $8,426  (6.6)
Segment EBITDA Margin  20.7%  23.3%    25.0%  26.7%  
             
             
Footnotes:           
The segment financial results and metrics above are adjusted to exclude the effects of special items, as the Company’s chief operating decision maker excludes these items in assessing segment performance.
             
Certain intersegment transactions with corporate entities have not been eliminated.
             



Verizon Communications Inc.           
Business - Selected Operating Statistics
             
             
             
             
Unaudited      12/31/19 12/31/18 % Change
             
Connections (‘000):            
Wireless retail postpaid connections        25,217   23,492  7.3
             
Fios video connections        77   74  4.1
Fios Internet connections        326   307  6.2
Fios digital connections        403   381  5.8
Broadband connections        489   501  (2.4)
Voice connections        4,959   5,400  (8.2)
             
             
             
             
             
  3 Mos. Ended 3 Mos. Ended   12 Mos. Ended 12 Mos. Ended  
Unaudited 12/31/19 12/31/18 % Change 12/31/19 12/31/18 % Change
             
Gross Additions ('000):            
Wireless retail postpaid  1,353   1,211  11.7  4,997   4,616  8.3
             
Net Add Detail (‘000):            
Wireless retail postpaid (1)  396   334  18.6  1,391   1,397  (0.4)
Wireless retail postpaid phones (1)  202   131  54.2  698   625  11.7
             
Fios video       *  3   3  
Fios Internet  4   5  (20.0)  20   22  (9.1)
Fios digital  4   5  (20.0)  23   25  (8.0)
Broadband  (3)  (5) 40.0  (12)  (17) 29.4
Voice  (99)  (129) 23.3  (440)  (493) 10.8
             
Churn Rate:            
Wireless retail postpaid  1.28%  1.26%    1.24%  1.19%  
Wireless retail postpaid phones  1.00%  1.07%    0.99%  0.98%  
             
Revenue Statistics (in millions):            
Wireless service revenue $2,869  $2,681  7.0 $11,188  $10,484  6.7
Fios revenues $242  $226  7.1 $967  $883  9.5
             
Other Operating Statistics:            
Wireless retail postpaid upgrade rate  5.0%  5.3%        
Total wireless Internet postpaid base (2)        33.6%  33.4%  
             
             
Footnotes:           
(1) Connection net additions include certain adjustments.          
(2) Statistics presented as of end of period.            
             
Certain intersegment transactions with corporate entities have not been eliminated.        
             
* Not meaningful            
             



Verizon Communications Inc.           
Supplemental Information - Wireless Historical Financial Results  
             
The following supplemental schedule contains historical Wireless segment results and is provided to help investors understand trends in our new segment results.
 
(dollars in millions)
Unaudited 3 Mos. Ended
12/31/19
 3 Mos. Ended
12/31/18
 % Change 12 Mos.
Ended 12/31/19
 12 Mos.
Ended 12/31/18
 % Change
             
Operating Revenues            
Service $16,330  $15,898  2.7 $65,044  $63,020  3.2
Equipment  6,771   6,821  (0.7)  21,563   22,258  (3.1)
Other  2,171   1,693  28.2  7,616   6,456  18.0
Total Operating Revenues  25,272   24,412  3.5  94,223   91,734  2.7
             
Operating Expenses            
Cost of services  2,668   2,351  13.5  10,129   9,251  9.5
Cost of equipment  7,255   7,128  1.8  22,954   23,323  (1.6)
Selling, general and administrative expense  4,984   4,552  9.5  18,045   16,604  8.7
Depreciation and amortization expense  2,226   2,395  (7.1)  9,066   9,736  (6.9)
Total Operating Expenses  17,133   16,426  4.3  60,194   58,914  2.2
             
Operating Income $8,139  $7,986  1.9 $34,029  $32,820  3.7
Operating Income Margin  32.2%  32.7%    36.1%  35.8%  
             
Segment EBITDA $10,365  $10,381  (0.2) $43,095  $42,556  1.3
Segment EBITDA Margin  41.0%  42.5%    45.7%  46.4%  
             
Footnotes:            
The segment financial results and metrics above are adjusted to exclude the effects of special items.
             
Certain intersegment transactions with corporate entities have not been eliminated.      
             



Verizon Communications Inc.           
Supplemental Information - Wireless Historical Operating Statistics
             
The following supplemental schedule contains historical Wireless segment results and is provided to help investors understand trends in our new segment results.
             
 
Unaudited 12/31/19 12/31/18 % Change
             
Connections (‘000)            
Retail postpaid        115,698   113,353  2.1
Retail prepaid        4,063   4,646  (12.5)
Total retail        119,761   117,999  1.5
             
             
Unaudited 3 Mos. Ended
12/31/19
 3 Mos. Ended
12/31/18
 % Change 12 Mos. Ended
12/31/19
 12 Mos. Ended
12/31/18
 % Change
             
Net Add Detail (‘000) (1)            
Retail postpaid  1,248   1,220  2.3  2,361   2,526  (6.5)
Retail prepaid  (121)  (90) (34.4)  (591)  (757) 21.9
Total retail  1,127   1,130  (0.3)  1,770   1,769  0.1
             
Account Statistics            
Retail postpaid accounts (‘000) (2)        35,401   35,427  (0.1)
Retail postpaid connections per account (2)        3.27   3.20  2.2
Retail postpaid ARPA (3) $138.07  $135.11  2.2 $137.89  $134.49  2.5
             
Churn Detail            
Retail postpaid  1.13%  1.08%    1.09%  1.03%  
Retail  1.29%  1.24%    1.27%  1.23%  
             
Retail Postpaid Connection Statistics (2)            
Total smartphone postpaid phone base        94.0%  92.2%  
Total Internet postpaid base        20.0%  19.7%  
             
Footnotes:            
(1) Connection net additions include certain adjustments.            
(2) Statistics presented as of end of period.            
(3) Wireless retail postpaid ARPA - average service revenue per account from retail postpaid accounts.      
             
Certain intersegment transactions with corporate entities have not been eliminated.         
             



Verizon Communications Inc.           
Supplemental Information - Wireline Historical Financial Results
             
The following supplemental schedule contains historical Wireline segment results and is provided to help investors understand trends in our new segment results.
(dollars in millions)
Unaudited 3 Mos. Ended
12/31/19
 3 Mos. Ended
12/31/18
 % Change 12 Mos. Ended
12/31/19
 12 Mos. Ended
12/31/18
 % Change
             
Operating Revenues            
Consumer Markets $3,121  $3,169  (1.5) $12,518  $12,589  (0.6)
Enterprise Solutions  2,102   2,217  (5.2)  8,411   8,840  (4.9)
Partner Solutions  1,015   1,098  (7.6)  4,177   4,692  (11.0)
Business Markets  784   836  (6.2)  3,227   3,397  (5.0)
Other  51   53  (3.8)  224   242  (7.4)
Total Operating Revenues  7,073   7,373  (4.1)  28,557   29,760  (4.0)
             
Operating Expenses            
Cost of services  4,493   4,478  0.3  17,194   17,701  (2.9)
Selling, general and administrative expense  1,736   1,597  8.7  6,437   6,151  4.6
Depreciation and amortization expense  1,469   1,571  (6.5)  6,075   6,181  (1.7)
Total Operating Expenses  7,698   7,646  0.7  29,706   30,033  (1.1)
             
Operating Loss $(625) $(273) * $(1,149) $(273) *
Operating Loss Margin  (8.8)%  (3.7)%    (4.0)%  (0.9)%  
             
Segment EBITDA $844  $1,298  (35.0) $4,926  $5,908  (16.6)
Segment EBITDA Margin  11.9%  17.6%    17.2%  19.9%  
             
Footnotes:            
             
The segment financial results and metrics above are adjusted to exclude the effects of special items.    
             
Certain intersegment transactions with corporate entities have not been eliminated.    
             
* Not meaningful            
             



Verizon Communications Inc.           
Supplemental Information - Wireline Historical Operating Statistics    
             
The following supplemental schedule contains historical Wireline segment results and is provided to help investors understand trends in our new segment results.
Unaudited       12/31/19 12/31/18 % Change
             
Connections (‘000)            
Fios video connections        4,229   4,451  (5.0)
Fios Internet connections        6,228   6,067  2.7
Fios digital voice residence connections        3,620   3,803  (4.8)
Fios digital connections        14,077   14,321  (1.7)
Broadband connections        6,956   6,961  (0.1)
Voice connections        10,713   11,732  (8.7)
             
             
Unaudited 3 Mos. Ended
12/31/19
 3 Mos. Ended
12/31/18
 % Change 12 Mos. Ended
12/31/19
 12 Mos. Ended
12/31/18
 % Change
             
Net Add Detail (‘000)            
Fios video connections  (51)  (46) (10.9)  (222)  (168) (32.1)
Fios Internet connections  39   54  (27.8)  161   217  (25.8)
Fios digital voice residence connections  (52)  (30) (73.3)  (182)  (102) (78.4)
Fios digital connections  (64)  (22) *  (243)  (53) *
Broadband connections  (5)  3  *  (5)  2  *
Voice connections  (249)  (277) 10.1  (1,019)  (1,089) 6.4
             
Revenue Statistics            
Fios revenues (in millions) $3,070  $3,046  0.8 $12,192  $11,939  2.1
             
Footnotes:            
Certain intersegment transactions with corporate entities have not been eliminated.    
             
* Not meaningful            
             



Verizon Communications Inc.                 
Non-GAAP Reconciliations - Consolidated Verizon   
                  
Consolidated EBITDA, Consolidated EBITDA Margin, Consolidated Adjusted EBITDA and Consolidated Adjusted EBITDA Margin   
                  
              (dollars in millions) 
Unaudited 3 Mos. Ended 12/31/2019 3 Mos. Ended 9/30/2019 3 Mos. Ended 6/30/2019 3 Mos. Ended 3/31/2019 3 Mos. Ended 12/31/2018 3 Mos. Ended 9/30/2018 3 Mos. Ended 6/30/2018 3 Mos. Ended 3/31/2018 
                  
Consolidated Net Income $5,217  $5,337  $4,074 $5,160  $2,065  $5,062  $4,246  $4,666 
  Add/(subtract):                 
Provision (benefit) for income taxes  (1,505)  1,586   1,236  1,628   (698)  1,613   1,281   1,388 
Interest expense  1,159   1,146   1,215  1,210   1,199   1,211   1,222   1,201 
Depreciation and amortization expense  4,105   4,114   4,232  4,231   4,352   4,377   4,350   4,324 
Consolidated EBITDA $8,976  $12,183  $10,757 $12,229  $6,918  $12,263  $11,099  $11,579 
                  
  Add/(subtract):                 
Other (income) expense, net* $1,773  $110  $1,312 $(295) $(1,865) $(214) $(360) $75 
Equity in losses (earnings) of unconsolidated businesses†  (5)  1   13  6   (64)  3   228   19 
Impairment charges  186           4,591          
Severance charges  204           1,818      339    
Product realignment charges‡                   450    
Acquisition and integration related charges‡             187   130   109   105 
Net gain from dispositions of assets and businesses     (261)                 
   2,158   (150)  1,325  (289)  4,667   (81)  766   199 
Consolidated Adjusted EBITDA $11,134  $12,033  $12,082 $11,940  $11,585  $12,182  $11,865  $11,778 
Consolidated Operating Revenues $34,775        $34,281        
Operating Income $6,639        $637        
Operating Income Margin  19.1%        1.9%       
Consolidated EBITDA Margin  25.8%        20.2%       
Consolidated Adjusted EBITDA Margin  32.0%               
                  
                  
* Includes Pension and benefits mark-to-market adjustments and Early debt redemption costs, where applicable.   
† Includes Product realignment charges and impairment charges, where applicable.                 
‡ Excludes depreciation and amortization expense, where applicable.                 
                  



Verizon Communications Inc.              
Non-GAAP Reconciliations - Consolidated Verizon          
               
Net Debt and Net Debt to Consolidated Adjusted EBITDA Ratio           
            (dollars in millions)
Unaudited           12/31/19 12/31/18
               
Debt maturing within one year           $  10,777 $  7,190
Long-term debt             100,712   105,873
Total Debt             111,489   113,063
Less Cash and cash equivalents             2,594   2,745
Net Debt           $  108,895 $  110,318
Net Debt to Consolidated Adjusted EBITDA Ratio           2.3x 2.3x
               
               
               
Net Unsecured Debt and Net Unsecured Debt to Consolidated Adjusted EBITDA Ratio           
            (dollars in millions)
Unaudited           12/31/19 12/31/18
               
               
Total Debt           $  111,489 $  113,063
Less Secured debt             12,369   10,076
Unsecured debt             99,120   102,987
Less Cash and cash equivalents             2,594   2,745
Net Unsecured Debt           $  96,526 $  100,242
Net Unsecured Debt to Consolidated Adjusted EBITDA Ratio          2.0x 2.1x
               
               
               
Adjusted Earnings per Common Share (Adjusted EPS)(1)            
      (dollars in millions, except per share amounts) 
Unaudited   3 Mos. Ended 12/31/19    3 Mos. Ended 12/31/18
 Pre-taxTax After-Tax   Pre-taxTax  After-Tax  
EPS     $  1.23       $  0.47
Severance, pension and benefits charges$  135$  (27) $  108   0.03 $  165$  (57)  $  108   0.03
Acquisition and integration related charges —  —   —   —    189  (47)    142   0.03
Impairment charges  236  (22)   214   0.05   4,591  (64)    4,527   1.09
Historical Wireless legal entity restructuring —  —   —   —   —   (2,065)    (2,065)   (0.50)
Disposition of preferred stock —   (2,247)   (2,247)   (0.54)  —  —    —   — 
Early debt redemption costs  2,060  (540)   1,520   0.37  —  —    —   — 
 $  2,431$  (2,836) $  (405) $  (0.10) $  4,945$  (2,233)  $  2,712 $  0.65
Adjusted EPS     $  1.13       $  1.12
               
               
               
      (dollars in millions, except per share amounts) 
Unaudited   12 Mos. Ended 12/31/19    12 Mos. Ended 12/31/18
 Pre-taxTax After-Tax   Pre-taxTax  After-Tax  
EPS     $  4.65       $  3.76
Severance, pension and benefits charges$  330$  (78) $  252   0.06 $  50$  (27)  $  23   0.01
Early debt redemption costs  3,604  (944)   2,660   0.64   725  (189)    536   0.13
Product realignment charges —  —   —   —    658  (149)    509   0.12
Acquisition and integration related charges —  —   —   —    553  (134)    419   0.10
Impairment charges  236  (22)   214   0.05   4,591  (64)    4,527   1.10
Historical Wireless legal entity restructuring —  —   —   —   —   (2,065)    (2,065)   (0.50)
Disposition of preferred stock —   (2,247)   (2,247)   (0.54)  —  —    —   — 
Net gain from dispositions of assets and businesses  (261)  37   (224)   (0.05)  —  —    —   — 
 $  3,909$  3,254 $  655 $  0.16 $  6,577$  (2,628)  $  3,949 $  0.96
Adjusted EPS     $  4.81       $  4.71
               
(1)  Adjusted EPS may not add due to rounding.              
               
               
               
Free Cash Flow            
            (dollars in millions)
Unaudited           12/31/19 12/31/18
               
Net Cash Provided by Operating Activities           $  35,746 $  34,339
Capital expenditures (including capitalized software)             (17,939)   (16,658)
Free Cash Flow           $  17,807 $  17,681
Year over year change %           0.7%  



     
Verizon Communications Inc.    
Non-GAAP Reconciliations - Segments   
     
Segment EBITDA and Segment EBITDA Margin
     
Consumer (dollars in millions)
     
Unaudited 3 Mos. Ended
12/31/19
 3 Mos. Ended
12/31/18
     
Operating Income $6,886  $6,803 
Add Depreciation and amortization expense  2,772   2,970 
Segment EBITDA $9,658  $9,773 
Year over year change  (1.2)%  
     
Total operating revenues $24,207  $23,733 
Operating Income Margin  28.4%  28.7%
Segment EBITDA Margin  39.9%  41.2%
     
     
     
  (dollars in millions)
     
Unaudited 12 Mos. Ended
12/31/19
 12 Mos. Ended
12/31/18
     
Operating Income $28,961  $28,011 
Add Depreciation and amortization expense  11,353   11,952 
Segment EBITDA $40,314  $39,963 
     
     
Total operating revenues $91,056  $89,762 
Operating Income Margin  31.8%  31.2%
Segment EBITDA Margin  44.3%  44.5%
     
     
     
Business (dollars in millions)
     
Unaudited 3 Mos. Ended
12/31/19
 3 Mos. Ended
12/31/18
     
Operating Income $666  $799 
Add Depreciation and amortization expense  1,007   1,068 
Segment EBITDA $1,673  $1,867 
Year over Year Change  (10.4)%  
     
Total operating revenues $8,071  $8,007 
Operating Income Margin  8.3%  10.0%
Segment EBITDA Margin  20.7%  23.3%
     
     
     
  (dollars in millions)
     
Unaudited 12 Mos. Ended
12/31/19
 12 Mos. Ended
12/31/18
     
Operating Income $3,762  $4,168 
Add Depreciation and amortization expense  4,105   4,258 
Segment EBITDA $7,867  $8,426 
     
     
Total operating revenues $31,443  $31,534 
Operating Income Margin  12.0%  13.2%
Segment EBITDA Margin  25.0%  26.7%
     



Verizon Communications Inc. 
Supplemental Information - VZ 2.0 to Historical Financial Results Reconciliation(1)
                 
The following tables present a reconciliation of financial results for our current reportable segments, Consumer and Business, to our historical reportable segments, Wireless and Wireline.
                 
 3 Mos. Ended 12/31/19 
  (dollars in millions)
 VZ 2.0Historical
 ConsumerBusinessTotal Reportable SegmentsAdjustments(2)Adjusted Total Reportable SegmentsWirelessWirelineHistorical Total Reportable Segments
UnauditedServiceEquipmentOtherTotal WirelessConsumer MarketsEnterprise SolutionsPartner SolutionsBusiness MarketsOtherTotal Wireline
External Operating Revenues                
Total Operating Revenues$ 24,207$ 8,071$ 32,278$ 67$ 32,345$ 16,330$ 6,771$ 2,171$ 25,272$ 3,121$ 2,102$ 1,015$ 784$ 51$ 7,073$ 32,345
                 
Operating Expenses                
  Cost of services4,1232,8176,9402217,161   2,668     4,4937,161
  Cost of wireless equipment5,8771,3777,25417,255   7,255     7,255
  Selling, general and administrative expense4,5492,2046,753(33)6,720   4,984     1,7366,720
  Depreciation and amortization expense2,7721,0073,779(84)3,695   2,226     1,4693,695
Total Operating Expenses17,3217,40524,72610524,831   17,133     7,69824,831
Operating Income (Loss)$ 6,886$ 666$ 7,552$ (38)$ 7,514   $ 8,139     $ (625)$ 7,514
  Add Depreciation and amortization expense2,7721,0073,779(84)3,695   2,226     1,4693,695
Segment EBITDA$ 9,658$ 1,673$ 11,331$ (122)$ 11,209   $ 10,365     $ 844$ 11,209
Operating Income (Loss) Margin28.4 %8.3 %      32.2 %     (8.8)% 
Segment EBITDA Margin39.9 %20.7 %      41.0 %     11.9 % 
                 
Footnotes:                
(1) Information presented for VZ 2.0 and historical financial results includes intersegment transactions.
(2) Adjustments represent intersegment transactions that have been eliminated under the new structure net of the impact of VZ Connect and other early-stage development businesses previously included in Corporate.
                 
 3 Mos. Ended 12/31/18 
  (dollars in millions)
 VZ 2.0Historical
 ConsumerBusinessTotal Reportable SegmentsAdjustments(2)Adjusted Total Reportable SegmentsWirelessWirelineHistorical Total Reportable Segments
UnauditedServiceEquipmentOtherTotal WirelessConsumer MarketsEnterprise SolutionsPartner SolutionsBusiness MarketsOtherTotal Wireline
External Operating Revenues                
Total Operating Revenues$ 23,733$ 8,007$ 31,740$ 45$ 31,785$ 15,898$ 6,821$ 1,693$ 24,412$ 3,169$ 2,217$ 1,098$ 836$ 53$ 7,373$ 31,785
                 
Operating Expenses                
  Cost of services3,8702,8326,7021276,829   2,351     4,4786,829
  Cost of wireless equipment5,8151,3137,1287,128   7,128     7,128
  Selling, general and administrative expense4,2751,9956,270(121)6,149   4,552     1,5976,149
  Depreciation and amortization expense2,9701,0684,038(72)3,966   2,395     1,5713,966
Total Operating Expenses16,9307,20824,138(66)24,072   16,426     7,64624,072
Operating Income (Loss)$ 6,803$ 799$ 7,602$ 111$ 7,713   $ 7,986     $ (273)$ 7,713
  Add Depreciation and amortization expense2,9701,0684,038(72)3,966   2,395     1,5713,966
Segment EBITDA$ 9,773$ 1,867$ 11,640$ 39$ 11,679   $ 10,381     $ 1,298$ 11,679
Operating Income (Loss) Margin28.7 %10.0 %      32.7 %     (3.7)% 
Segment EBITDA Margin41.2 %23.3 %      42.5 %     17.6 % 
                 
Footnotes:                
(1) Information presented for VZ 2.0 and historical financial results includes intersegment transactions.
(2) Adjustments represent intersegment transactions that have been eliminated under the new structure net of the impact of VZ Connect and other early-stage development businesses previously included in Corporate.
                 
 12 Mos. Ended 12/31/19 
  (dollars in millions)
 VZ 2.0Historical
 ConsumerBusinessTotal Reportable SegmentsAdjustments(2)Adjusted Total Reportable SegmentsWirelessWirelineHistorical Total Reportable Segments
UnauditedServiceEquipmentOtherTotal WirelessConsumer MarketsEnterprise SolutionsPartner SolutionsBusiness MarketsOtherTotal Wireline
External Operating Revenues                
Total Operating Revenues$ 91,056$ 31,443$ 122,499$ 281$ 122,780$ 65,044$ 21,563$ 7,616$ 94,223$ 12,518$ 8,411$ 4,177$ 3,227$ 224$ 28,557$ 122,780
                 
Operating Expenses                
  Cost of services15,88410,65526,53978427,323   10,129     17,19427,323
  Cost of wireless equipment18,2194,73322,952222,954   22,954     22,954
  Selling, general and administrative expense16,6398,18824,827(345)24,482   18,045     6,43724,482
  Depreciation and amortization expense11,3534,10515,458(317)15,141   9,066     6,07515,141
Total Operating Expenses62,09527,68189,77612489,900   60,194     29,70689,900
Operating Income (Loss)$ 28,961$ 3,762$ 32,723$ 157$ 32,880   $ 34,029     $ (1,149)$ 32,880
  Add Depreciation and amortization expense11,3534,10515,458(317)15,141   9,066     6,07515,141
Segment EBITDA$ 40,314$ 7,867$ 48,181$ (160)$ 48,021   $ 43,095     $ 4,926$ 48,021
Operating Income (Loss) Margin31.8 %12.0 %      36.1 %     (4.0)% 
Segment EBITDA Margin44.3 %25.0 %      45.7 %     17.2 % 
                 
Footnotes:                
(1) Information presented for VZ 2.0 and historical financial results includes intersegment transactions.
(2) Adjustments represent intersegment transactions that have been eliminated under the new structure net of the impact of VZ Connect and other early-stage development businesses previously included in Corporate.
                 
 12 Mos. Ended 12/31/18 
  (dollars in millions)
 VZ 2.0Historical
 ConsumerBusinessTotal Reportable SegmentsAdjustments(2)Adjusted Total Reportable SegmentsWirelessWirelineHistorical Total Reportable Segments
UnauditedServiceEquipmentOtherTotal WirelessConsumer MarketsEnterprise SolutionsPartner SolutionsBusiness MarketsOtherTotal Wireline
External Operating Revenues                
Total Operating Revenues$ 89,762$ 31,534$ 121,296$ 198$ 121,494$ 63,020$ 22,258$ 6,456$ 91,734$ 12,589$ 8,840$ 4,692$ 3,397$ 242$ 29,760$ 121,494
                 
Operating Expenses                
  Cost of services15,33510,85926,19475826,952   9,251     17,70126,952
  Cost of wireless equipment18,7634,56023,32323,323   23,323     23,323
  Selling, general and administrative expense15,7017,68923,390(635)22,755   16,604     6,15122,755
  Depreciation and amortization expense11,9524,25816,210(293)15,917   9,736     6,18115,917
Total Operating Expenses61,75127,36689,117(170)88,947   58,914     30,03388,947
Operating Income (Loss)$ 28,011$ 4,168$ 32,179$ 368$ 32,547   $ 32,820     $ (273)$ 32,547 
  Add Depreciation and amortization expense11,9524,25816,210(293)15,917   9,736     6,18115,917
Segment EBITDA$ 39,963$ 8,426$ 48,389$ 75$ 48,464   $ 42,556     $ 5,908$ 48,464
Operating Income (Loss) Margin31.2 %13.2 %      35.8 %     (0.9)%  
Segment EBITDA Margin44.5 %26.7 %      46.4 %     19.9 % 
                 
Footnotes:                
(1) Information presented for VZ 2.0 and historical financial results includes intersegment transactions.
(2) Adjustments represent intersegment transactions that have been eliminated under the new structure net of the impact of VZ Connect and other early-stage development businesses previously included in Corporate.

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Source: Verizon Communications