Verizon’s 5G adoption rises as Q2 success hits record high
Verizon has reported record success in the second quarter of 2021 caused by an increase in the adoption of its 5G phone service, customer and sequential wireless service revenue growth, and network reliability. The company revised its revenue and adjusted EPS guidance upward for the full year as a result.
Hans Vestberg, Chairman and CEO of Verizon, said: “We are executing on our multipurpose network strategy and producing positive results in each of our five growth vectors, recording strong second-quarter results. With more connections on our network than anyone else, our already excellent network performance improved in the quarter and was recognized by RootMetrics as the best overall network performance for the 16th time in a row. We are also expanding our 5G Ultra-Wideband and 5G Home markets”.
He added that that the company “is excited about its momentum leading into the second half of the year”, and that it is “on track” to close the Tracfone and Verizon Media transactions.
Verizon’s Q2 2021 highlights
- US$1.40 in earnings per share (EPS); adjusted EPS*, excluding special items, of US$1.37.
- Operating revenue of US$33.8bn, a result of strong sequential wireless revenue growth.
- Net income of US$5.9bn and adjusted EBITDA* of US$12.2bn.
- Total wireless service revenue of US$16.9bn, a 5.9% increase year over year, and a 4.0 percent increase from second-quarter 2019.
- Total retail postpaid churn of 0.94 percent, and retail postpaid phone churn of 0.72 percent.
- 528,000 retail postpaid net additions, including 275,000 phone net additions, resulting in 121.3mn total retail connections.
- Total revenue of US$23.5 bn, an increase of 11.2% year over year, and an increase of 6.7% from second-quarter 2019.
- Total retail postpaid churn of 0.83%, and retail postpaid phone churn of 0.65 percent, a record-low retail postpaid phone churn outside of second-quarter 2020 and third-quarter 2020, which were heavily impacted by the COVID-19 pandemic.
- 350,000 retail postpaid net additions, including 197,000 phone net additions, driving 5G-phone adoption to approximately 20% of Consumer wireless phone customers and step-ups to premium unlimited plans.
- 92,000 Consumer Fios Internet net additions. The company's trailing 12-month total Fios Internet net addition performance is the highest since 2015.
- Total revenue of US$7.8bn, an increase of 3.7% year over year, and relatively flat from second-quarter 2019.
- Total retail postpaid churn of 1.30%, and retail postpaid phone churn of 1.07%.
- 178,000 retail postpaid net additions, including 78,000 phone net additions.
“Second quarter results were exceptional, both financially and operationally,” said Verizon Chief Financial Officer Matt Ellis. “Our strong first-half performance and the momentum in our business gives us the confidence to raise our total wireless service revenue growth guidance to between 3.5% and 4%, an update from prior guidance for 2021 total wireless service revenue growth of at least 3%. We are also raising our adjusted EPS guidance* to the range of US$5.25 to US$5.35, an update from prior guidance for 2021 adjusted EPS* of US$5.00 to US$5.15”.
Also in Q2, Verizon came to an agreement with Apollo funds to sell Verizon Media, the expected close date being in the second half of 2021. Following this, the Verizon Media business classified certain assets as “Held for Sale”, which the company no longer depreciated or paid off. According to Verizon, this led to a partial quarter benefit of three cents per share in Q2, which will continue as a benefit until the deal is closed.
Verizon, Samsung complete 5G data session on C-band spectrum
U.S telecom Verizon, in partnership with Samsung Electronics, has completed a trial of a 5G data session over the C-band spectrum. The test was conducted in a live network environment using cloud-native, end-to-end virtualisation in preparation for Verizon’s 5G Ultra Wideband expansion.
Adam Koeppe, Senior Vice President of Technology Planning at Verizon, said: “We have been driving the industry to large-scale virtualisation using the advanced architecture we have built into our network from the core to the far edge. This recent accomplishment paves the way for a more programmable, efficient, and scalable 5G network. “Customers deserve more than mere access to 5G. They deserve 5G built with the highest, gold-standard engineering practices that have positioned Verizon as the most reliable industry leader for years.”
The importance of virtualisation in optimising 5G network performance
According to Samsung, Virtualisation plays a vital role in delivering advanced 5G network services. This is due to 5G use cases such as IoT solutions, more robust consumer devices and solutions, AR/VR, remote healthcare, autonomous robotics in manufacturing environments, and ubiquitous smart city solutions, becoming more dependant on the programmability of virtualised networks.
Pleased with the result of the trial, Junehee Lee, Executive Vice President and Head of R&D, Networks Business at Samsung Electronics, said: “We’re proud to mark another milestone following our first large-scale commercial 5G vRAN deployment for Verizon, which is currently servicing millions of users. This trial reinforces our commitment to helping operators evolve their advanced 5G networks.”
The trials used Samsung’s fully virtualized RAN (vRAN) solution built on its own software stack and C-band 64T64R Massive MIMO radio in coordination with Verizon’s virtualized core. “The trials achieved speeds commensurate with traditional hardware-based equipment,” the companies said.
Verizon claims that cloud-native, virtualised architecture provides greater flexibility aster delivery of services, greater scalability, and improved cost efficiency in networks”, allowing it to lead the way in network slicing and wide-scale mobile edge computing.
The technology also enables Verizon to respond quickly to customer’s latency and computing needs. Virtualisation aims to lower the entry barrier for new vendors in the ecosystem while entrants will be able to accelerate innovation and reduce operating costs, the companies said.
Verizon is planning to make the 5G C-band spectrum initially available to 46 markets by the first quarter of 2022, and provide the Ultra-Wideband service to 100mn people. Throughout the next two years, the company expects coverage to increase to 175mn people before reaching 250mn by the end of 2024.