Verizon (VZ) Q2 2026 Earnings Preview

Report date: July 24, 2026 (before market open) | Call: 2026Q2 Earnings Call

Setup Into the Print

Verizon comes into tomorrow's report as one of the more controversial large-cap dividend stocks in the market right now. Shares are up roughly 9-13% year-to-date — outperforming AT&T and T-Mobile — but the stock has been extremely volatile over the past month on a string of idiosyncratic and industry headlines:

SpaceX overhang: Reports that Charter Communications held high-level talks with SpaceX about a consumer mobile phone partnership triggered sharp multi-day selloffs in VZ, T and TMUS in late June and again in early July (VZ fell as much as 7.5% in a single session), on fears that Starlink could become a real competitive threat to the "Big Three" carriers. Wells Fargo initiated coverage at Equal Weight ($43 PT) explicitly citing Starlink as a competitive risk, while Barclays trimmed its target to $45 and Morgan Stanley held at $50/Equal Weight.
Dow removal: Verizon was removed from the Dow Jones Industrial Average (replaced by Alphabet) effective June 29 — a symbolic, if not fundamentally material, event.
BT/international JV: Verizon is forming a ~$4 billion-revenue international joint venture with BT, combining international units. Management has flagged this will drive a $700–800 million one-time loss in the current (second) quarter tied to held-for-sale accounting — an important GAAP/adjusted reconciliation item to watch in tomorrow's release.
Retail/cost restructuring: Verizon is cutting roughly 3,000 jobs as part of divesting 274 retail stores to franchisees, continuing the aggressive cost/headcount actions (16,000+ positions eliminated) that CEO Dan Schulman has pushed since taking over.
New pricing/plan simplification: Verizon launched "Simplicity," a streamlined wireless plan, in June, alongside a new loyalty rewards program — part of the broader move away from promotion-heavy, complexity-laden offers.

The Turnaround Narrative Heading In

The core story for VZ this year has been a operational turnaround under new CEO Dan Schulman (a former PayPal exec), and Q1 2026 was the clearest proof point yet:

First positive Q1 postpaid phone net adds in 13 years (+55,000), a ~344,000 improvement year-over-year, with consumer postpaid phone churn falling to 0.90% in the quarter and below 0.85% by March — the lowest in years.
Adjusted EPS of $1.28, up 7.6% y/y — the best growth rate in over four years — with record adjusted EBITDA and margin expansion of 140bps to 38.9%.
Cost of acquisition/retention down ~35% versus Q4, reflecting a shift to "micro-segmentation" and less reliance on blanket handset subsidies.
Fiber and FWA momentum: fiber broadband subscribers jumped 42% to 10.8 million (including ~2 million from the Frontier deal, closed January 20, 2026), and fixed wireless access grew 24% to 6 million customers.
Guidance was raised in April: adjusted EPS growth to 5–6% (from 4–5%), and postpaid phone net adds to the upper half of the 750K–1M range, while reaffirming mobility/broadband service revenue growth of 2–3% (with Q1 as the low point of the year) and free cash flow growth of ~7%+ (implying ~$21.5B or more for 2026).
Balance sheet: net unsecured debt/EBITDA rose to ~2.6x post-Frontier, but management says it has paid down about half of Frontier's assumed debt and expects to retire substantially all of it by year-end, with a path back to a 2.0–2.25x target leverage ratio by 2027.
Capital returns: 20th consecutive annual dividend increase (+2.5%, or $0.07/share) announced in January, plus $2.5 billion of buybacks executed in Q1 alone against a full-year plan of "at least $3 billion" — the first repurchases in over a decade.

What Analysts/Consensus Expect for Q2

Per pre-earnings coverage, Wall Street is modeling adjusted EPS of roughly $1.28 on revenue of about $35.2 billion, versus $1.21 and $34.5 billion in the year-ago quarter. Full-year 2026 consensus EPS sits around $4.95, up from about $4.79 at the start of the year — implying roughly 5% annual profit growth, consistent with management's own 5–6% guidance range. Goldman Sachs (Buy, $56 PT) has been notably bullish, expecting full-year net postpaid additions above 1.17 million — well ahead of the company's own 750K–1M guide — while sell-side sentiment is otherwise mixed: Wells Fargo, Barclays and Morgan Stanley all sit at Equal Weight/Hold-equivalent ratings with targets in the $43–$50 range, and the broader analyst average target (~$52) implies more modest upside than Goldman's call.

Key Things to Watch in Tomorrow's Report

Does the Q1 momentum carry into Q2? Investors will want confirmation that postpaid phone net adds and churn improvements were sustained (not a one-quarter phenomenon), especially since management called Q1 "the low point" for mobility/broadband service revenue growth for the year.
Wireless service revenue trajectory — Q1 wireless service revenue was down 1% y/y, dragged by ~80bps of network-outage customer credits and lapping prior-year price increases. Watch for confirmation that ARPA/account growth is inflecting positively as promoted.
BT joint venture accounting impact — the flagged $700–800M one-time loss this quarter should be reconciled clearly against adjusted (non-GAAP) results; watch how management frames this versus the ongoing "shed non-core assets" strategy.
Frontier integration and synergies — progress toward the $1 billion+ run-rate cost synergy target by 2028, fiber passings pace (guided to 32 million+ by year-end 2026, with a medium-term ambition of 40–50 million), and debt paydown from the deal.
Cost transformation / $5 billion 2026 opex savings target — updates on the 10-workstream transformation program, AI-driven efficiency initiatives (customer service automation, network AI, vendor cost reduction), and whether savings are tracking ahead of or in line with plan.
Capital returns cadence — any update on buyback pace beyond the $3 billion base plan, and commentary on leverage progress toward the 2.0–2.25x 2027 target.
Competitive/SpaceX commentary — given how much of the recent stock move has been driven by SpaceX/Charter speculation, management will likely be pressed on competitive response plans, spectrum strategy ahead of the 2027 FCC mid-band auction, and its own direct-to-cell arrangement with AST SpaceMobile.
Guidance reaffirmation/revision — whether the April-raised full-year targets (5–6% EPS growth, upper-half phone net adds, ~7%+ FCF growth, 2–3% mobility/broadband service revenue growth) are reaffirmed, raised further, or tempered given the BT JV charge and elevated restructuring costs (severance ran ~$1.1B in Q1 alone).

Bottom Line

Verizon heads into Q2 earnings with real, measurable operational improvement — its best subscriber and churn trends in over a decade, record EBITDA, and increased full-year guidance — set against a backdrop of macro noise (Dow removal, SpaceX-driven multiple compression, a one-time GAAP charge from the BT JV) that has weighed on sentiment more than fundamentals. With a dividend yield near the top of the market (~6%) and a "show-me" turnaround story still in early innings, the market's reaction will likely hinge less on the historical Q2 numbers (which look set to come in close to consensus) and more on whether management can credibly extend the Q1 trend of stronger net adds, lower churn, and improving unit economics into the back half of a year that still carries integration, restructuring, and competitive uncertainty.