Verizon Boosts Subscriber Forecast, Inks $2B+ AI Infrastructure Deal with AWS

Verizon Communications on Monday raised its annual forecast for wireless subscriber additions and announced a new AI infrastructure deal with Amazon Web Services (AWS) valued at over $2 billion. The news followed a third-quarter report that showed stronger-than-expected subscriber growth, sending the company's shares up 2.4% in premarket trading.

Upgraded Outlook and Q3 Performance

Verizon significantly beat analyst estimates for subscriber growth in the third quarter, reporting 406,000 new monthly-bill paying wireless subscribers. This figure was nearly double the Visible Alpha consensus expectation of 209,439, as reported by Reuters. The strong performance prompted the company to lift its full-year guidance.

Key forecast updates include:

• Postpaid phone subscribers: Now expected to be between 1.1 million and 1.2 million for the year, up from a previous range of 750,000 to 1 million.
• Adjusted earnings per share (EPS): Full-year forecast raised to $5.04 to $5.06, from a prior $4.99 to $5.04.

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Despite the subscriber gains, Verizon's third-quarter revenue of $34.3 billion fell short of the $34.74 billion consensus estimate from LSEG data. The company attributed the revenue pressure to lower device upgrade volumes, as customers are holding onto their phones for longer periods after Verizon reduced device subsidies.

Strategic Push into AI Infrastructure

The deal with Amazon's cloud unit marks a significant step for Verizon in capitalizing on the growing demand for artificial intelligence computing. Under the agreement, Verizon will provide high-capacity fiber-optic connectivity for AWS data centers, enabling faster and more reliable data transfers required for intensive AI workloads.

This move builds on a similar agreement announced in July, when Verizon signed a more than $1 billion deal with Google to connect its data centers using dark fiber. These large-scale infrastructure deals highlight an emerging, high-value revenue stream for telecommunications operators beyond their traditional wireless and broadband services, driven directly by the expansion of the AI industry.