Verizon Communications, Inc. VZ is scheduled to report second-quarter 2026 earnings before the opening bell on July 24. The Zacks Consensus Estimate for sales and earnings is pegged at $35.31 billion and $1.27 per share, respectively. Earnings estimates for VZ have improved marginally over the past 60 days, increasing from $4.95 to $4.98 per share for 2026 and from $5.27 to $5.28 for 2027.
VZ Estimate Trend
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Earnings Surprise History
The communication services provider has a solid trailing four-quarter earnings surprise history, having exceeded expectations on each occasion. It delivered a four-quarter earnings surprise of 3.2%, on average. In the last reported quarter, the company pulled off an earnings surprise of 4.9%.
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Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Verizon for the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Verizon currently has an ESP of -1.09% with a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors Shaping Upcoming Results
During the quarter, Verizon played a major role in powering connectivity and digital infrastructure for the FIFA World Cup 2026. It served as the Official Telecommunication Services Sponsor, deploying its advanced wireless and fiber technologies, including 5G Ultra Wideband, private 5G networks, Fiber broadband infrastructure, Fixed Wireless Access and Broadcast transmission solutions. This is likely to have generated solid revenues for Verizon’s Business segment.
By powering the Broadcast Contribution Network, Verizon helped FIFA deliver live HD footage and game data worldwide. Its networking solution ensured secure connectivity for FIFA officials, referee technology, stadium operations and logistics teams. The company also deployed temporary connectivity solutions for pop-up retail stores, merchandise booths, event offices and fan zones. The deployment in such a global event will validate VZ’s FWA technology in a real-world, mission-critical scenario and is expected to have a favorable impact on Verizon’s second-quarter results.
In the quarter under review, Verizon entered into a joint venture agreement with BT Group to expand its presence in global enterprise connectivity. The 50:50 partnership combines Verizon’s international enterprise wireline business with BT’s international operations, creating a scaled platform focused on serving multinational customers. The new venture is expected to serve more than 3,000 enterprise customers across more than 180 countries, generating approximately $4 billion in annual revenue. The extended geographic footprint is expected to improve operational efficiency, enhance service delivery and create economies of scale across network infrastructure and support operations. The platform will likely help Verizon address rising demand for cloud services and AI-driven applications by offering more advanced and reliable network solutions.
However, adverse foreign currency translations, infrastructure investments and high operating costs for 5G deployments are likely to have led to soft margins in the quarter. Verizon has announced a three-year price lock guarantee for all its myPlan and myHome network plans. This ensures that the core monthly plan price for calling, data and texting will not change in the next three-year period, excluding taxes, fees and perks. Although this customer-centric model will entice new customers, the promotional offers and lucrative discounts are expected to weigh on margins. In addition, the company’s wireline division is struggling with persistent losses in access lines owing to competitive pressure from the voice-over-Internet protocol (VoIP) service providers and aggressive triple-play (voice, data and video) offerings by cable companies.
Price Performance
Over the past year, VZ has gained 1.2% compared with the industry’s growth of 70.2%. It has outperformed its peers like AT&T Inc. T and T-Mobile US Inc. TMUS over this period. While AT&T declined 20%, T-Mobile was down 16.1%.
One-Year VZ Stock Price Performance
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Key Valuation Metric
From a valuation standpoint, Verizon appears attractive relative to the industry and is trading below its mean. Going by the price/earnings ratio, the company shares currently trade at 8.45 forward earnings, lower than 42.62 for the industry and the stock’s mean of 8.77.
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Investment Considerations
By investing steadily in fiber infrastructure and pioneering new technologies, Verizon is well-positioned to bridge the digital divide and enhance the connectivity landscape nationwide. This is likely to translate into solid subscriber growth, higher average revenue per user and increased broadband and fiber penetration.
However, high capital expenditures due to the continued expansion of 5G mmWave in new and existing markets, the densification of the 4G LTE wireless network and the deployment of the fiber infrastructure are likely to have eroded margins. An ongoing shift from traditional linear video to over-the-top offerings, along with a competitive and almost saturated U.S. wireless market, is expected to weigh on the company’s revenues in the future.
End Note
Verizon’s effective customer-focused strategy, combined with a strong 5G network, is driving momentum in the wireless vertical. With rising earnings estimates, the stock is witnessing a positive investor perception. However, intense competition is concerning. Macroeconomic challenges remain a drag. Consequently, it might not be prudent to bet on the stock at the moment.
However, a single quarter’s results are not so important for long-term stakeholders, and investors already owning the stock could stay put. In addition, an attractive valuation and focus on the deployment of a cloud-native, container-based, virtualized architecture for higher flexibility, scalability and cost efficiency across its network will benefit it in the long term.
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This article originally published on Zacks Investment Research (zacks.com).