Keeping an eye on a newish rival.
SpaceX (SPAX.PVT) agreed on Monday to pay $17 billion for the right to use some of Echostar's wireless spectrum. The deal would allow Elon Musk-owned SpaceX to offer 5G cell phone and broadband services to consumers.
SpaceX is the highest-valued private company with a valuation of $458 billion, according to Yahoo Finance data.
“They can, of course, compete in broadband to consumers. We have many other competitors there. So, of course, I'm not naive, they can and they will compete with us in some areas, but I also see them as very complementary and adding to my opportunity to serve my customers even better,” Verizon CEO Hans Vestberg told me at the Goldman Sachs Communacopia + Tech conference on Monday.
Verizon's second quarter got mixed reviews from Wall Street.
The telecom giant revealed 51,000 postpaid phone net losses in the quarter. Total postpaid churn — people rolling off the service — rose to 1.24% from 1.11% a year ago. The results come after Verizon hiked prices in January. It announced a three-year phone price lock in April.
“Verizon's churn increases remain troubling,” said MoffettNathanson analyst Craig Moffett.
Rivals T-Mobile (TMUS) and AT&T (T) had 1.7 million and 410,000 postpaid net additions in the second quarter, respectively.
Verizon did lift its full-year adjusted profit growth estimate to between 1% and 3%, up from 0% to 3% previously.
“While we like the converged strategy, we question Verizon’s growth algorithm as the company 1) comps prior year price increases, 2) faces promo amort headwinds, and 3) laps strong consumer net add improvements,” said JPMorgan analyst Sebastiano Petti.
Verizon shares have performed relatively in line with the S&P 500 (^GSPC) this year, up about 11%. T-Mobile's stock has gained 15% this year, while AT&T has tacked on 30%.
Vestberg said he expects the company's $20 billion deal for fiber play Frontier to close in the first quarter of 2026. The transaction will provide a jolt to Verizon's ability to offer fiber to millions of households across the United States.
Verizon had previously sold assets to Frontier, making it easier for the company to integrate the acquisition. Vestberg also pointed to the revenue synergy of offering mobile plans with broadband.
“When this is approved, we're going to have fiber in 31 states,” Vestberg said.
Brian Sozzi is Yahoo Finance's Executive Editor and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
