Verizon's FWA base crosses 3M mark

Fixed wireless access (FWA) continued to serve as a growth engine for Verizon's broadband business in the fourth quarter of 2023 as its combined consumer and business FWA base exceeded 3 million subscribers.

Verizon tacked on 375,000 FWA subs (231,000 consumer and 144,000 business) in Q4, raising its total to 3.06 million (1.86 million consumer and 1.2 million business). Consumer FWA adds of 231,000 were down slightly from year-ago adds of 262,000, and business FWA adds of 144,00 were up from year-ago adds of 117,000.

Update: About 80% of Verizon's consumer FWA subscriber gross ads were in the operator's C-band markets.

"The [FWA] product is maturing" and performing well where the company has deployed fresh C-band spectrum, Verizon CEO Hans Vestberg said on today's Q4 call.

FWA adds 'a little soft'

Though FWA subs were up across the consumer and business categories, the results were "a little soft," New Street Research analyst Jonathan Chaplin said in a research note. New Street was expecting Verizon to add 379,000 consolidated FWA subs compared to the 375,000 reported.

"Verizon didn't expand C-Band markets much in 4Q23, and so this result isn't a test of the quandary we have for 2024 broadband trends (they will expand C-Band markets significantly, yet they are guiding to flat FWA access through the year). We are waiting to see how this evolves over the course of the year," Chaplin wrote.

Fios Internet gains offset DSL losses

On the consumer wireline side, Verizon added 39,000 subs, up from a gain of 40,000 in the year-ago period, for a total of 7.19 million.

Within consumer wireline, Verizon added 53,000 Fios Internet customers, up 3.5% year-over-year, for a total of 6.97 million. Verizon shed another 15,000 DSL subscribers.

When FWA and wireline are combined, Verizon added 270,000 consumer broadband subs, down from a gain of 302,000 in the year-ago period. Verizon ended Q4 with 9.05 million consumer broadband subscribers, up 14.6% on a year-over-year basis.

For full-year 2023, Verizon added 1.7 million broadband customers, up from 1.3 million in the prior year. Total FWA net adds for 2023 were 1.5 million, up from 1.2 million for full 2022.

Verizon expects broadband subscribers to grow further into 2024, fueled in part by its C-band deployment for FWA services and Fios footprint expansion (about 400,000 new locations expected this year), CFO Tony Skiadas said.

Vestberg said the company feels "comfortable" it can add about 400,000 net broadband subs (Fios and FWA) per quarter across both consumer and business.

Vestberg reiterated that Verizon will participate in the Broadband Equity Access and Deployment (BEAD) program, noting that the company has already salted away a couple of wins in the early going.

Financial snapshot

Among select financials, Verizon turned in Q4 consumer Fios revenues of $2.94 billion, up year-over-year. Total Fios revenues for Q4, including business revenues, were $3.3 billion, up 1.1% year-over-year.

Business services remained in decline. Verizon posted Q4 business revenues of $7.6 billion, down 3.6%, driven by lower wireline revenue and lower wireless equipment revenue, but partially offset by higher wireless service revenue.

Consolidated total operating revenue for Q4 was down 0.3%, to $35.1 billion.