Detailed Narrative
New CEO Vision and Strategic Pivot
Dan Schulman's appointment as CEO marks a "critical inflection point" for Verizon, signaling a fundamental shift from a technology-centric to a customer-first company. The new strategy emphasizes "financially disciplined growth," aiming to win with the right customers and achieve both volume and profitability growth simultaneously. Schulman highlighted the need to aggressively transform the culture and financial profile of the company, operating with boldness, customer-centricity, and financial discipline.
Customer-Centric Growth and Retention Focus
Schulman articulated a primary objective to grow the customer base profitably across mobility and broadband. He stated that reliance on price increases without subscriber growth is unsustainable and that Verizon must significantly elevate its game across the entire customer experience. The goal is to achieve the lowest churn rate in the industry by creating the best overall value proposition, leveraging true innovation, and making it easier for customers to do business with Verizon.
Cost Transformation and Capital Efficiency
A significant imperative is to drive a much more efficient cost structure, aggressively reducing the entire cost base to fund incremental investments in customer delight. This includes a thorough examination of both operating expenses and capital spend, with a commitment to becoming a "simpler, leaner and scrappier business." The company also plans to sunset or exit legacy businesses where a clear path to profitable market leadership is not evident, aiming for meaningful margin improvement.
Convergence and Fiber Expansion Strategy
Convergence is identified as a significant near-term growth opportunity, particularly with the pending acquisition of Frontier, expected to close in Q1 2026. This deal will expand Verizon's reach to approximately 29 million fiber passings, creating substantial cross-sell opportunities for mobility and broadband. Additionally, a new capital-light partnership with Tillman will enable Fios expansion into new markets outside Verizon's existing and pro forma Frontier footprint, further driving convergence.
Leveraging AI for Customer Experience and Efficiency
Schulman emphasized the growing power of AI as a key tool to transform Verizon's operations and customer experience. AI will be used to simplify offers, improve retention through smart and personalized marketing, and dramatically enhance service while reducing costs and complexity across business processes. He noted that AI models are rapidly improving and will enable Verizon to anticipate customer needs and tailor offers at micro-segment levels.
Capital Allocation and Shareholder Returns
Verizon reiterated its "ironclad commitment" to its dividend, continued debt repayment, and value-creating capital return. The company will be more deliberate in allocating spend, ensuring investments support the completion of the C-band build-out and long-term fiber expansion, while preserving financial capacity for strategic investments. The net unsecured debt to adjusted EBITDA ratio has already dropped to 2.2x, within the long-term target range, ahead of schedule.