FiOS Internet net additions in 4Q17

In the previous article, we discussed a few of the pay-TV market trends affecting Verizon (VZ). Verizon is managing the secular challenges of the pay-TV market by concentrating on its Internet offering in FiOS. It would be interesting to know more about Verizon’s FiOS Internet net customer additions in 4Q17, as the company has continued to face strong competition from cable companies.

In 3Q17, Verizon gained 66,000 FiOS Internet subscribers compared to the 90,000 net additions it saw in 3Q16. However, the net gains in the company’s FiOS Internet connections in 3Q17 were offset by a fall in its number of DSL-based (digital subscriber line) Internet connections. This reduction in total broadband users was primarily the result of competitive pressures from cable companies such as Comcast (CMCSA) and Charter (CHTR) as they managed to add the most Internet customers.

Expectations for Verizon’s FiOS Internet Customer Acquisitions in 4Q17

FiOS Gigabit Connection

Verizon’s management highlighted that the FiOS Gigabit Connection, which the company launched in certain markets in 2017, continues to gain traction, offering speeds of up to 1 Gbps.

In 3Q17, Verizon’s FiOS Internet penetration fell 20 bps (basis point) to 40.2% compared to 40.4% in 3Q16. The number of FiOS Internet subscribers rose ~3.9% on a year-over-year basis to reach 5.8 million at the end of 3Q17.

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