FiOS video customer growth
Earlier in this series, we learned about Verizon’s (VZ) wireline segment. We also looked at the recent performance of the enterprise component of the wireline division. A key driver of Verizon’s wireline segment is its FiOS service.
FiOS is fiber-based and offers Internet, IPTV (Internet protocol television), and voice services to consumers and businesses. It is similar to AT&T’s (T) U-verse and can be compared to offerings of cable players such as Comcast (CMCSA) and Time Warner Cable (TWC).
During the recent Wells Fargo Technology, Media, and Telecom Conference held on November 10, 2015, Verizon’s chief financial officer Francis Shammo talked about FiOS video customer growth.
According to Shammo, “It’s going to be competitive, although where we sit in FiOS we still believe we have a great footprint on the East Coast. It’s a highly-populated footprint.”
Shammo also added, “We believe we still have a lot of growth in taking from our competitors, because although it has been a decline, it’s not going to be a steep decline. But it’s not going to be we’re going to add new customers every year from growth in linear TV.”
Verizon’s FiOS subscriber metrics in 3Q15
As you can see in the above chart, video customer net additions for Verizon’s FiOS service have been low in the last two quarters. The telecom (telecommunication) company had net FiOS video subscriber additions of ~42,000 and ~26,000, respectively, in 3Q15 and 2Q15. In 3Q14, the company had net additions in this category of ~114,000.
Instead of taking direct exposure to Verizon’s stock, you may wish to look into diversified exposure to the telecom company by investing in the iShares US Telecommunications ETF (IYZ). The ETF held ~10.8% in Verizon at the end of September 2015.