Verizon Communications Inc. · NYSE:VZ
Verizon Communications — Investor Presentation (June 2019)
26 slides from Verizon Communications's investor presentation, Jun 18, 2019
Slide 1: Verizon 2.0 Segment Reporting Webcast
Verizon 2.0 Segment Reporting Webcast June 18, 2019
Slide 2: Safe Harbor statement
“Safe Harbor” statement NOTE: In this presentation we have made forward-looking statements. These statements are based on our estimates and assumptions and are subject to risks and uncertainties. Forward-looking statements include the information concerning our possible or assumed future results of
Slide 3: Hans Vestberg, Chairman and Chief Executive Officer
Hans Vestberg Chairman and Chief Executive Officer
Slide 4: Today's Agenda
Today’s Agenda Verizon’s Strategy Verizon 2.0 VZ 1.0 to VZ 2.0 Comparisons and Recast Financials 4
Slide 5: Verizon Strategy Fundamentals
Verizon Strategy Fundamentals CONTINUED NETWORK LEADERSHIP CUSTOMER DRIVEN MODELS • Operating Model Based on Customer Needs • Network as a Service (NaaS) Digitalization • Company-wide Assets for New Applications and Services • 5G & iEN Defend, Extend and New • Ecosystem Partnerships TRUSTED BRAN
Slide 6: Verizon 2.0 Transformation
Verizon 2.0 Transformation Network as a Service Foundation / NETWORK Intelligent Edge Network Process Reengineering PROCESS for Future Flexibility Responsible Brand Representing BRAND Trust & Innovation Customer Centric BUSINESS Operating Model TALENT & Leadership & Culture for LEADERSHIP “Future of
Slide 7: Verizon Network as a Service Transformation
Verizon Network as a Service Transformation Consumer/Business/Media/Partners Customer value delivery and digital experience Public Sector & Other Products & Services Wholesale Small / Medium Seamless delivery to Business & Global Media Enterprise any customer segment Group Video & Content IoT & Mana
Slide 8: Verizon 2.0 Operating Model
Verizon 2.0 Operating Model Effective as of April 1, 2019 Consumer Verizon Consumer Wireless Retail Group Wholesale Products Small & Medium Public Sector Verizon Business Business & Other Group Products Global Wholesale Enterprise Verizon Media Intelligent Edge Network Media Ad Group Products Vertic
Slide 9: Matt Ellis, Chief Financial Officer
Matt Ellis Chief Financial Officer
Slide 10: Verizon 2.0 Reporting Structure
Verizon 2.0 Reporting Structure Reportable Consumer Business Corporate & Other Segments Operating Consumer Business Media Eliminations & Other Segments • Consumer Wireless • Global Enterprise • VZ Media Includes (Includes Wireless (Wireless / Wireline) Wholesale) • Small and Medium • Consumer Wireli
Slide 11: VZ 1.0 to VZ 2.0 Comparison: 2018
VZ 1.0 to VZ 2.0 Comparison: 2018 2018 Revenues Verizon Verizon 1.0 2.0 Wireless 69% Consumer 68% Wireline Business 23% 24% Corp & Other 2% Media 6% Corp & Other 2% Media 6% Total Corp & Other 8% Total Corp & Other 8% Excludes eliminations 11
Slide 12: VZ 1.0 to VZ 2.0 Comparison: 1Q '19
VZ 1.0 to VZ 2.0 Comparison: 1Q ‘19 1Q ’19 Revenues Verizon Verizon 1.0 2.0 Wireless 70% Consumer 69% Wireline Business 22% 24% Corp & Other 3% Media 5% Corp & Other 2% Media 5% Total Corp & Other 8% Total Corp & Other 7% Excludes eliminations 12
Slide 13: VZ 1.0 to VZ 2.0 Reconciliation: 2018
VZ 1.0 to VZ 2.0 Reconciliation: 2018 Consumer Revenue ($B) VZ 1.0 VZ 2.0 ($14.6) $91.7 $12.8 ($0.1) $89.8 Total Wireless Consumer Wireline Business Wireless Eliminations Total Consumer EBITDA* $42.6 $40.0 Margin %* 46.4% 44.5% Business Revenue ($B) $0.9 ($12.8) $14.6 ($1.0) $29.8 $31.5 EBITDA 42.6
Slide 14: VZ 1.0 to VZ 2.0 Reconciliation: 1Q '19
VZ 1.0 to VZ 2.0 Reconciliation: 1Q ’19 Consumer Revenue ($B) VZ 1.0 VZ 2.0 ($3.7) $22.7 $3.1 (NM) $22.1 Total Wireless Consumer Wireline Business Wireless Eliminations Total Consumer EBITDA* $10.8 $10.1 Margin %* 47.4% 45.8% Business Revenue ($B) $3.7 $0.2 ($3.1) $7.3 ($0.4) $7.7 EBITDA 42.6 2.1 (5
Slide 15: Wireless Trends: Consumer vs. Business
Wireless Trends: Consumer vs. Business Confidence in service revenue outlook Consumer Business Financials 2018 1Q ’19 2018 1Q ’19 Total Wireless Revenue ~$77B ~$19B ~$15B ~$4B Service Revenue YoY Growth 1.0%* 3.7% 5.0%* 7.7% Segment Characteristics Service revenue impacted in 2017; SMB follows Consu
Slide 16: Consumer Trends: Annual
Consumer Trends: Annual Revenue growth in wireless, strong stable margins Total Revenue ($B) Wireless Service Revenue ($B) $89.5 $87.1 $89.8 $55.6 10.0% Wireline $13.0 $13.0 $12.8 $52.0 $52.5 50.0 0.0% Wireless $76.5 $74.1 $77.0 30.0 -10.0% 2016 2017 2018 2016 2017 2018 YoY % Growth (2.7%) 3.1% YoY
Slide 17: Consumer Trends: Quarterly
Consumer Trends: Quarterly Wireless seasonality drives in-year trends Total Revenue ($B) Wireless Service Revenue ($B) $23.7 $13.4 $21.6 $22.0 $22.4 $22.1 $13.1 $13.3 $13.2 $3.2 $12.9 Wireline $3.2 $3.2 $3.2 $3.1 Wireless $18.4 $18.8 $19.2 $20.5 $19.0 1Q ’18 2Q ’18 3Q ’18 4Q ’18 1Q ’19 1Q ’18 2Q ’18
Slide 18: Consumer Trends: Key Wireless Metrics
Consumer Trends: Key Wireless Metrics Retail Postpaid Gross Adds (K) Retail Postpaid Activations (K) 3,643 6.6% 7.00% 14 ,000 2,850 5.0% 5.1% 5.1% 6.00% 2,634 2,617 2,714 12,000 4.4% 5.00% 10,000 9,492 4.00% 8,000 7,093 7,127 7,402 6,652 3.00% 6,000 2.00% 4,000 1.00% 2,000 0 0.00% 1Q ’18 2Q ’18 3Q ’
Slide 19: Business Trends: Annual
Business Trends: Annual Wireless revenue growth offsetting wireline declines, more heavily impacted by ASC 606 Total Revenue ($B) Wireless Service Revenue ($B) % of 2018 $29.5 $30.9 $31.5 Wholesale $4.0 $4.0 $3.7 12% $11.1 $5.8 18% $10.8 Public Sector and Other $5.1 $5.7 $10.5 Small and Medium $9.0
Slide 20: Business Trends: Quarterly
Business Trends: Quarterly Strong growth in wireless service revenue Total Revenue ($B) Wireless Service Revenue ($B) $7.8 $7.9 $7.9 $8.0 $7.7 Wholesale $1.0 $1.0 $0.9 $0.9 $0.8 $1.5 $2.6 $2.7 $2.7 $2.7 Public Sector and Other $1.4 $1.4 $1.5 $1.5 $2.5 Small and Medium $2.5 $2.6 $2.7 $2.8 $2.7 Busine
Slide 21: Business Trends: Key Wireless Metrics
Business Trends: Key Wireless Metrics Retail Postpaid Gross Adds (K) Retail Postpaid Activations (K) 5,000 7.00% 4,9 00 4,8 00 4,700 4,6 00 4,500 4,4 00 4,3 00 5.3% 6.00% 4,200 4,1 00 4,000 4.9% 3,9 00 4.8% 3,8 00 4.6% 3,700 3,6 00 4.4% 5.00% 3,500 3,4 00 3,300 3,200 1,162 1,163 1,211 1,143 3,1 00 3
Slide 22: Key Dates and Disclosure Information
Key Dates and Disclosure Information 2Q ’19 earnings call – August 1 • 2Q ’19 earnings release and SEC report in Verizon 2.0 structure • Supplemental disclosure: Wireless / Wireline revenue, EBITDA and operating metrics 2Q ’19 Form 10-Q – August 8 • Recast disclosure (including MD&A) for 1Q ’19 and
Slide 23: Looking Forward: Verizon 2.0 Accelerates Our Strategy
Looking Forward: Verizon 2.0 Accelerates Our Strategy Strategy • Total focus on customers and providing the best experiences on our networks 2.0 • Operating model enables strong, customer-focused go-to-market strategy • Verizon is leading the way in 5G Financials • Poised for sustainable growth, dri
Slide 24: Q&A
Q&A
Slide 25: Slide 25
Slide 26: VZ 2.0 Reporting: Supplemental
VZ 2.0 Reporting VZ 2.0 Supplemental Revenue Consumer Business Wireless Wireline Wireless Service Wireless Equipment Wireless Other Total Revenue Operating Metrics Wireless Postpaid Net Adds Wireless Postpaid Phone Net Adds Wireless Postpaid Churn Wireless Postpaid Phone Churn Fios Video Net Adds Fi
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