Verizon’s wireless service revenue
The falling trend in Verizon’s (VZ) wireless service revenue continued in 4Q17. The telecommunications company reported wireless service revenue of $15.9 billion in 4Q17, a ~2.9% fall YoY (year-over-year).
This reduction in wireless service revenue was primarily the result of lost overage revenue and rate-plan optimization, mostly by single-line users, following the introduction of VZ’s unlimited offerings. In 3Q17, the company had reported wireless service revenue of $15.8 billion, a ~5.1% fall YoY.
During the Morgan Stanley Technology, Media & Telecom Conference on February 27, 2018, Matt Ellis, Verizon’s chief financial officer, spoke about the growth in Verizon’s wireless service revenue. Ellis stated that the company is on track to achieve YoY wireless service revenue growth by 2H18, which excludes the impact of the new revenue recognition standard.
The drivers of this improvement include the large migration of VZ’s subscriber base to unsubsidized plans and the company’s continued low churn since the relaunch of its unlimited plans. Further, ~80% of postpaid phone customers are now on unsubsidized pricing plans compared to 78% in 3Q17.
Performance of other US wireless carriers in 4Q17
Now let’s assess the wireless service revenue growths of the other major US wireless service carriers in 4Q17. Sprint’s (S) wireless service revenue fell ~5.5% YoY to $5.6 billion, whereas T-Mobile’s (TMUS) wireless service revenue rose ~7.1% YoY to $7.8 billion. Meanwhile, AT&T’s (T) wireless service revenue from its combined domestic operations fell ~2.5% YoY to $14.3 billion.