Verizon’s FiOS Internet net additions
Verizon (VZ) is managing the secular challenges of the pay-TV market by focusing on its FiOS Internet offering in the wireline component. In the second quarter, it added 43,000 FiOS Internet customers compared to 49,000 net additions in the year-ago period. However, net gains in FiOS Internet connections were offset by a decline of 53,000 in high-speed Internet connections. As a result, total net broadband connections for Verizon fell 10,000 in the second quarter.
The reduction in high-speed Internet connections was mainly due to competitive pressures from top US cable companies Comcast (CMCSA) and Charter Communications (CHTR). Charter added 218,000 residential broadband customers in the second quarter, and Comcast added 226,000.
Verizon’s FiOS Gigabit Connection
Verizon believes that its FiOS Gigabit Connection is gaining traction, offering speeds up to 1 Gbps (gigabit per second). Its FiOS Internet customers rose ~3.9% YoY (year-over-year) to 6 million at the end of June.
Verizon continues to be optimistic about the growth trajectory of its broadband business since demand is growing for high-speed Internet connections as people migrate to television services delivered over the Internet from the likes of Amazon (AMZN) Prime Video, Alphabet’s YouTube TV, and Netflix (NFLX). Netflix gained 5.1 million customers worldwide in the second quarter.