Verizon Communications, Inc. VZ is scheduled to report third-quarter 2026 earnings before the opening bell on Oct. 26. The Zacks Consensus Estimate for sales and earnings is pegged at $34.81 billion and $1.27 per share, respectively. Earnings estimates for VZ in 2026 have remained unchanged over the past 60 days, while 2027 estimates have risen 0.19%.
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 2.9%, on average. In the last reported quarter, the company pulled off an earnings surprise of 2.3%.
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Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Verizon for the third 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 -0.68% 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’s subsidiary, Total Wireless, announced an expanded partnership with Western Union, bringing money transfers, bill pay and money orders to its retail locations nationwide. The rollout will begin in select stores and is expected to expand through the end of 2026. The initiative broadens Total Wireless’ value proposition beyond wireless connectivity and supports Verizon’s efforts to strengthen its value-brand offerings.
In the to-be-reported quarter, Verizon inked a multi-year, multi-billion-dollar supply agreement with Corning to support broadband expansion and next-generation AI infrastructure. The deal will strengthen Verizon’s fiber network capabilities and support growing connectivity and data demands across its network.
Verizon is advancing its 6G initiatives by adding nine technology companies to its 6G Innovation Forum and conducting real-world trials of integrated sensing and communications. The company is also exploring AI-native technologies for future connectivity and network applications.
The company has partnered with SPECS Inc. to introduce new SPECS AR Glasses that combine augmented reality with Verizon’s connectivity capabilities. The collaboration aims to enhance connected wearable experiences and expand AR use across consumer and enterprise applications. Such innovations are expected to positively impact upcoming results.
However, it is to be noted that Verizon operates in a highly competitive and saturated U.S. telecom market. The company faces competition from major players such as AT&T, Inc. T and T-Mobile US, Inc. TMUS. This is likely to weigh on margins.
Price Performance
Over the past year, VZ has gained 11.9% compared with the industry’s growth of 108.1%. It has outperformed its peers like AT&T and T-Mobile US over this period. Shares of AT&T and T-Mobile have plunged 8.4% and 30.7%, respectively, in the same time frame.
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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's shares currently trade at 8.5 forward earnings, lower than 33.85 for the industry and the stock’s mean of 8.77.
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Investment Considerations
Verizon is delivering strong consumer metrics, highlighted by robust postpaid phone net additions and sequentially lower customer churn. Strategic offerings like simplified rate plans and focused loyalty incentives are successfully retaining users without requiring high promotional costs.
The integration of Frontier Communications has significantly broadened Verizon's fiber reach across multiple states. Total fixed wireless and fiber connections continue to rise, driven by lower churn among customers who bundle mobility and broadband services.
The domestic telecommunications sector remains intensely competitive, with aggressive pricing and promotional bundling from rival carriers and cable operators posing continuous pressure on market share and margins. Maintaining a leadership position in 5G, fiber expansion and AI-related infrastructure requires heavy upfront capital spending. Delays in realizing returns on these multi-billion-dollar investments could weigh on near-term financial flexibility.
End Note
Verizon’s long-term strategy remains centered on combining wireless and broadband services to improve customer retention and lifetime value. The company continues to broaden its addressable market through fiber expansion and broadband growth while strengthening convergence opportunities. However, intense competition and a high debt burden remain major concerns. VZ appears to be treading the middle of the road, and new investors could be better off if they trade with caution.
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This article originally published on Zacks Investment Research (zacks.com).