uploads///Telecom Verizons Postpaid Net Additions

Verizon’s Postpaid Net Additions Decreased in 4Q15


Jan. 27 2016, Updated 11:07 a.m. ET

Verizon’s postpaid customers in 4Q15

In the previous part of this series, we saw that in 4Q15, Verizon’s (VZ) postpaid upgrade rate was lower YoY (year-over-year), as the company expected. Now let’s see how Verizon performed in terms of wireless customer additions during the quarter.

In the postpaid component, Verizon’s customers increased by ~4.4% YoY to reach ~106.5 million by the end of 4Q15. This growth in the telecom company’s postpaid metrics was slightly lower than what it witnessed in 3Q15. Verizon’s postpaid customers increased by ~4.9% YoY during that quarter.

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Verizon’s postpaid net additions in 4Q15

In terms of net additions of customers, Verizon’s postpaid metric was lower YoY during 4Q15.  As you can see in the above graph, the telecom company’s net postpaid additions decreased by ~23.5% YoY to reach ~1.5 million during the quarter. Earlier in 3Q15, the company’s postpaid customer additions on a net basis declined ~15% YoY to ~1.3 million.

Now let’s look at Verizon’s customer additions by device type. On a net basis, the carrier added ~449,000 postpaid phone connections during the quarter. The telecom company’s smartphone net additions were ~713,000 in 4Q15.

Smartphone users carry particular value for wireless carriers. Those who use Apple’s (AAPL) iPhone and Google’s (GOOG) (GOOGL) Android phones tend to have relatively high data usage.

Instead of a direct exposure to Verizon’s stock, you may take a diversified exposure to the telecom company by investing in the SPDR Dow Jones Industrial Average ETF (DIA).

DIA held ~1.8% in Verizon at the end of December 2015. Note that the company was the only telecom player in this ETF.


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