What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-07-31 compared with 2026-05-01 · 270 added, 156 removed, 466 unchanged (48% of the section changed)

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To compete effectively in today’s dynamic marketplace, we are focused on delivering what customers want and need in the digital world by offering innovative products and services, delivering excellent customer experience, and leveraging the capabilities of our high-performing networks.

Highlights of Our Financial Results for the Three Months Ended March 31, 2026 and 2025

Highlights of Our Financial Results for the Three Months Ended June 30, 2026 and 2025

(dollars in millions)

Highlights of Our Financial Results for the Six Months Ended June 30, 2026 and 2025

(dollars in millions)

Business Overview

We have two reportable segments that we operate and manage as strategic business units - Verizon Consumer Group (Consumer) and Verizon Business Group (Business).

Revenue by Segment for the Three Months Ended March 31, 2026 and 2025

Revenue by Segment for the Three Months Ended June 30, 2026 and 2025

Revenue by Segment for the Six Months Ended June 30, 2026 and 2025

Excludes eliminations.

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Customers can obtain our wireless services on a postpaid or prepaid basis.

Our postpaid service is generally billed one month in advance for a monthly access charge in return for access to and usage of network services.

Our prepaid service is offered only to Consumer customers and enables individuals to obtain wireless services without credit verification by paying for all services in advance.

Postpaid customers are qualified retail customers that we service and manage on our networks primarily under the Verizon brand.

Prepaid customers are exclusively Consumer retail customers who obtain wireless connectivity by paying for services in advance.

The Consumer segment also offers several categories of wireless equipment to customers, including a variety of smartphones and other handsets, wireless-enabled internet devices, such as tablets, and other wireless-enabled connected devices, such as smart watches.

In addition to wireless services and equipment for retail customers, the Consumer segment sells residential fixed connectivity solutions, including internet, video and voice services, and wireless network access to resellers on a wholesale basis.

The Consumer segment's operating revenues for the three months ended March 31, 2026 totaled $26.5 billion, representing an increase of 3.3% compared to the similar period in 2025.

The Consumer segment's operating revenues for the three and six months ended June 30, 2026 totaled $26.2 billion and $52.7 billion, respectively, representing a decrease of 1.5% and an increase of 0.8%, respectively, compared to the similar periods in 2025.

See "Segment Results of Operations" for additional information regarding our Consumer segment’s operating performance.

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and a subset of these products and services to customers around the world.

The Business segment's operating revenues for the three months ended March 31, 2026 totaled $7.4 billion, representing an increase of 1.8% compared to the similar period in 2025.

The Business segment's operating revenues for the three and six months ended June 30, 2026 totaled $7.2 billion and $14.3 billion, respectively, representing an increase of 2.6% and 2.2%, respectively, compared to the similar periods in 2025.

See "Segment Results of Operations" for additional information regarding our Business segment’s operating performance.

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Corporate and other primarily includes device insurance programs, investments in unconsolidated businesses and development stage businesses that support our strategic initiatives, as well as unallocated corporate expenses, certain pension and other employee benefit related costs and interest and financing expenses.

Corporate and other also includes the historical results of divested businesses and other adjustments and gains and losses that are not allocated or used in assessing segment

performance due to their nature.

Corporate and other also includes the results of divested businesses and businesses held for sale, as well as other adjustments and gains and losses that are not allocated or used in assessing segment performance due to their nature.

Although such transactions are excluded from the business segment results, they are included in reported consolidated earnings.

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Our strategy requires significant capital investments primarily to invest in and deploy fiber, acquire wireless spectrum, put the spectrum into service, provide additional capacity for growth in our networks, evolve and maintain our networks and develop and maintain significant advanced information technology systems and data system capabilities.

During the three months ended March 31, 2026, these investments included $4.2 billion for capital expenditures.

During the six months ended June 30, 2026, these investments included $8.2 billion for capital expenditures.

See "Cash Flows Used in Investing Activities" for additional information.

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We are densifying our networks by utilizing macro and small cell technology, in-building solutions and distributed antenna systems to increase coverage, improve quality of service and add capacity to accommodate an increasing number of users.

Recent Developments

On May 14, 2026, Verizon entered into an agreement in principle with AT&T Inc.

and T-Mobile US, Inc., to form a new joint venture which aims to help end wireless dead zones in the U.S., including in rural areas, by pooling limited spectrum resources to increase capacity, improve the customer experience, and help satellite providers reach more customers through a unified platform.

This initiative is expected to extend mobile connectivity for wireless customers through joint investment in using satellite-based, direct-to-device technologies to address coverage gaps, especially in unserved and underserved communities.

The joint venture remains subject to negotiating definitive agreements between the parties and satisfying customary closing conditions.

On June 28, 2026, the Company entered into a transaction agreement (the Transaction Agreement) with BT Group plc (BT) and Jasper NewCo Limited (NewCo), pursuant to which the Company and BT will each acquire a 50% equity interest in NewCo.

Closing of the transaction is subject to customary regulatory approvals and other closing conditions.

See "Acquisitions and Divestitures" below for additional information.

Consolidated Results of Operations

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During the first quarter of 2026, Verizon revised its presentation of revenue reporting for its reportable segments - Consumer and Business.

Accordingly, beginning in the first quarter of 2026, Verizon is reporting Consumer and Business revenue disaggregated by products and services as follows:

Accordingly, beginning in the first quarter of 2026, Verizon is reporting Consumer and Business revenue disaggregated

by products and services as follows:

Mobility and broadband service revenue, Wireless equipment revenue and Other revenue.

In the first quarter of 2026, Verizon also made changes to the presentation of certain operating metrics, and going forward will only disclose operating metrics on a consolidated basis.

In the first quarter of 2026, Verizon also made changes to the presentation of certain operating metrics, and going forward will only report operating metrics on a consolidated basis.

In the second quarter of 2026, the net assets representing Verizon's international wireline connectivity and managed network services business (the Verizon Contributed Business) were classified as assets and liabilities held for sale and moved from the Business segment to Corporate and other.

Where applicable, historical segment results have been reclassified to conform to the current period presentation.

See Note 3 to the condensed consolidated financial statements for additional information.

Consolidated Operating Revenues

Three Months Ended

March 31, Increase/(Decrease)

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

(dollars in millions) 2026 2025 2026 2025

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Consolidated Operating Revenues $ 34,253 $ 34,504 $ (251) (0.7) $ 68,693 $ 67,989 $ 704 1.0

Consolidated operating revenues increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to revenue increases in our Consumer and Business segments.

Consolidated operating revenues decreased during the three months ended June 30, 2026 compared to the similar period in 2025 primarily due to a revenue decrease in our Consumer segment, partially offset by a revenue increase in our Business segment.

Consolidated operating revenues increased during the six months ended June 30, 2026 compared to the similar period in 2025 primarily due to revenue increases in our Consumer and Business segments.

Revenues for our segments are discussed separately below under the heading "Segment Results of Operations."

Consolidated Operating Expenses

Three Months Ended

March 31, Increase/(Decrease)

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

(dollars in millions) 2026 2025 2026 2025

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Aggregate customer service costs, which include billing and service provisioning, are allocated between Cost of services and Selling, general and administrative expense.

Cost of services increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily as a result of:

• an increase of $174 million in personnel costs driven by an increase in employee headcount following the acquisition of Frontier Communications Parent, Inc.

• an increase of $114 million in building and facility costs primarily due to higher utility rates along with maintaining additional buildings and facilities due to the acquisition of Frontier in 2026;

Cost of services increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

The increase during the three months ended June 30, 2026 was primarily as a result of:

• an increase of $199 million in personnel costs mainly driven by an increase in employee headcount following the acquisition of Frontier Communications Parent, Inc.

• an increase of $109 million in digital content costs primarily associated with an increase in subscriptions through plan offerings and the inclusion of Frontier results, partially offset by a decrease in traditional linear content costs related to lower Fios video volumes;

• an increase of $79 million in building and facility costs primarily due to maintaining additional buildings and facilities associated with the acquisition of Frontier in 2026 along with higher utility rates;

• an increase of $58 million related to asset rationalization charges taken in 2026;

• a decrease of $164 million in access costs primarily related to cessation of certain third-party provider costs along with a decrease in circuit usage.

The increase during the six months ended June 30, 2026 was primarily as a result of:

• an increase of $373 million in personnel costs driven by an increase in employee headcount following the acquisition of Frontier;

• an increase of $193 million in building and facility costs primarily due to maintaining additional buildings and facilities associated with the acquisition of Frontier in 2026 along with higher utility rates;

• an increase of $147 million in digital content costs primarily associated with an increase in subscriptions through plan offerings and the inclusion of Frontier results, partially offset by a decrease in traditional linear content costs related to lower Fios video volumes;

• an increase of $58 million related to asset rationalization charges taken in 2026;

• a decrease of $247 million in access costs primarily related to cessation of certain third-party provider costs along with a decrease in circuit usage.

Cost of Wireless Equipment

Cost of wireless equipment increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to:

Cost of wireless equipment decreased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

The decrease during the three months ended June 30, 2026 was primarily due to a decrease of $1.1 billion driven by a lower volume of wireless devices sold primarily related to a strategic decrease in upgrades.

The decrease during the six months ended June 30, 2026 was primarily as a result of:

• a decrease of $1.0 billion driven by a lower volume of wireless devices sold primarily related to a strategic decrease in upgrades;

• an increase of $270 million driven by a shift to higher priced equipment in the mix of wireless devices sold.

• an increase of $85 million driven by a higher volume of wireless devices sold primarily related to an increase in upgrades.

Selling, General and Administrative Expense

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Also included is a portion of the aggregate customer care costs as discussed above in "Cost of Services."

Selling, general and administrative expense decreased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily as a result of:

• a decrease of $282 million in advertising costs related to various marketing campaigns in the first quarter of 2025 that did not reoccur;

• a decrease of $121 million in personnel costs related to the impact of workforce reduction initiatives announced in the prior year;

• an increase of $261 million related to acquisition and integration related charges recorded in 2026 associated with the acquisition of Frontier.

See "Special Items" for additional information on the acquisition and integration related charges.

Selling, general and administrative expense increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

The increase during the three months ended June 30, 2026 was primarily as a result of:

• the $746 million net loss in connection with the classification of the assets and liabilities representing Verizon's international wireline connectivity and managed network services business as assets and liabilities held for sale;

• an increase of $397 million due to severance charges related to our workforce reduction initiatives;

• an increase of $200 million related to asset rationalization charges taken in 2026;

• an increase of $135 million related to acquisition and integration related charges recorded in 2026 primarily associated with the acquisition of Frontier;

• a decrease of $193 million in advertising costs related to various marketing campaigns in the first half of 2025 that did not reoccur.

The increase during the six months ended June 30, 2026 was primarily as a result of:

• an increase of $397 million due to severance charges related to our workforce reduction initiatives;

• an increase of $396 million related to acquisition and integration related charges recorded in 2026 primarily associated with the acquisition of Frontier;

• an increase of $200 million related to asset rationalization charges taken in 2026;

• a decrease of $475 million in advertising costs related to various marketing campaigns in the first half of 2025 that did not reoccur.

See "Special Items" for additional information on the net loss on disposition of business, severance charges, the acquisition and integration related charges and the asset rationalization charges.

Depreciation and Amortization Expense

Depreciation and amortization expense increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to the change in the mix of net depreciable and amortizable assets, including the impact of depreciable assets acquired as part of the Frontier acquisition, and the continued deployment of C-Band network assets.

Depreciation and amortization expense increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily due to the change in the mix of net depreciable and amortizable assets, including the impact of depreciable assets acquired as part of the Frontier acquisition.

Consolidated Operating Statistics

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Wireless retail postpaid connections are retail postpaid customer device connections as of the end of the period.

Wireless retail postpaid connections under an account may include those from phones, postpaid FWA, as well as tablets and other internet

devices, wearables and retail IoT devices.

Wireless retail postpaid connections under an account may include those from phones, postpaid FWA, as well as tablets and other internet devices, wearables and retail IoT devices.

Wireless retail postpaid connections are calculated by adding retail postpaid new connections in the period to prior period retail postpaid connections, and subtracting retail postpaid disconnects in the period.

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Wireless retail core prepaid connections are calculated by adding retail core prepaid new connections in the period to prior period retail core prepaid connections, and subtracting retail core prepaid disconnects in the period.

Wireless retail core prepaid phone connections are retail prepaid customer phone connections, excluding our SafeLink brand, as of the end of the period.

Wireless retail core prepaid phone connections include those from smartphones and basic phones.

Wireless retail core prepaid phone connections are calculated by adding retail core prepaid phone new connections in the period to prior period retail core prepaid phone connections, and subtracting retail core prepaid phone disconnects in the period.

Fiber broadband connections are the total number of connections to the internet using fiber broadband services (which exclude solutions provided over a traditional copper-based network) as of the end of the period.

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Wireless retail core prepaid connections, net additions in each period presented are calculated by subtracting the retail core prepaid disconnects from the retail core prepaid new connections in the period.

Wireless retail core prepaid phone connections, net additions are the total number of additional retail customer core prepaid phone connections, less the number of phone disconnects in the period.

Wireless retail core prepaid phone connections, net additions in each period presented are calculated by subtracting the retail core prepaid phone disconnects from the retail core prepaid phone new connections in the period.

Fiber broadband connections, net additions are the total number of additional fiber broadband connections, less the number of fiber broadband disconnects in the period.

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Wireless retail postpaid ARPA in each period presented is calculated by dividing wireless retail postpaid service revenue by the average wireless retail postpaid accounts in the period.

Wireless retail core prepaid ARPU is the calculated average wireless retail core prepaid service revenue, excluding our SafeLink brand, per unit (core prepaid connection) (ARPU) in the period.

Wireless retail core prepaid ARPU in each period presented is

calculated by dividing wireless retail core prepaid service revenue by the average wireless retail core prepaid connections in the period.

Wireless retail core prepaid ARPU is the calculated average wireless retail core prepaid service revenue, excluding our SafeLink brand, per unit (wireless retail core prepaid connection) (ARPU) in the period.

Wireless retail core prepaid ARPU in each period presented is calculated by dividing wireless retail core prepaid service revenue by the average wireless retail core prepaid connections in the period.

Wireless retail postpaid phone churn is the rate at which service to retail postpaid phone connections is terminated on average in the period.

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The wireless retail core prepaid churn rate in each period presented is calculated by dividing wireless core prepaid disconnects by the average wireless core prepaid connections in the period.

Wireless retail postpaid connections, upgrade rate is the rate at which retail postpaid connections upgrade retail postpaid devices (phones, tablets, and other devices) in the period.

Wireless retail postpaid connections, upgrade rate is calculated by dividing the number of retail postpaid connections that have upgraded a retail postpaid device in the period by the average retail postpaid connections for the period.

Wireless retail postpaid connections, upgrade rate is the rate at which retail postpaid connections upgrade retail customer postpaid devices (phones, tablets, and other devices) in the period.

Wireless retail postpaid connections, upgrade rate is calculated by dividing the number of retail postpaid connections that have upgraded a retail customer postpaid device in the period by the average retail postpaid connections for the period.

Where applicable, our operating statistics discussed above and the operating results presented in the following table reflect certain adjustments, including those related to migration activity among different types of devices and plans, customer profile changes, product-related changes and adjustments in connection with mergers, acquisitions and divestitures.

Three Months Ended

March 31, Increase/(Decrease)

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

2026 2025 2026 2025

Connections (‘000) (1) :

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Wireless retail core prepaid 19,351 19,017 334 1.8

Wireless retail core prepaid phone 18,654 18,502 152 0.8

Fiber broadband 10,913 7,613 3,300 43.3

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Wireless retail 223 177 46 26.0 % 107 112 (5) (4.5)

Wireless retail postpaid (196) (159) (37) (23.3)

Wireless retail postpaid phone 55 (289) 344 nm

Wireless retail postpaid 188 155 33 21.3 (8) (4) (4) nm

Wireless retail postpaid phone 184 (9) 193 nm 239 (298) 537 nm

Wireless retail core prepaid 73 50 23 46.0 188 187 1 0.5

Fiber broadband 127 45 82 nm

Wireless retail core prepaid phone 24 24 — — 94 134 (40) (29.9)

Fiber broadband 155 32 123 nm 282 77 205 nm

FWA broadband 193 278 (85) (30.6) 407 586 (179) (30.5)

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Upgrade rate 2.6 % 3.6 %

(1) As of end of period.

(2) Total broadband excludes solutions provided over a traditional copper-based network.

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Other Income, Net

Three Months Ended

March 31, Increase

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

(dollars in millions) 2026 2025 2026 2025

Interest income $ 147 $ 63 $ 84 nm

Interest income $ 72 $ 55 $ 17 30.9 % $ 219 $ 118 $ 101 85.6 %

Other components of net periodic benefit income (cost) (91) (138) 47 (34.1) 80 (232) 312 nm

Net debt extinguishment gains 152 88 64 72.7 247 178 69 38.8

Other, net 64 62 2 3.2

Other, net (97) 74 (171) nm (33) 136 (169) nm

Other Income, Net

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Other income, net reflects certain items not directly related to our core operations, including interest income, debt extinguishment gains and losses, components of net periodic pension and postretirement benefit income and cost and certain foreign exchange gains and losses.

Other income, net increased for the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to:

• a net pension and postretirement benefits remeasurement gain of $237 million in 2026;

Other income, net decreased for the three months ended June 30, 2026 and increased during the six months ended June 30, 2026 compared to the similar periods in 2025.

The decrease during the three months ended June 30, 2026 was primarily due to fair market value adjustments on certain investments and derivatives.

The increase during the six months ended June 30, 2026 was primarily as a result of:

• a net pension remeasurement gain of $237 million in 2026 compared to a net pension remeasurement loss of $45 million in 2025, along with higher expected returns on pension plan assets;

• an increase of $70 million in paid-in-kind interest earned on certain preferred investments;

• a decrease resulting from fair market value adjustments on certain investments and derivatives.

See Note 8 to the condensed consolidated financial statements for more information on the other components of net periodic benefit income (cost).

Interest Expense

Three Months Ended

March 31, Increase/(Decrease)

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

(dollars in millions) 2026 2025 2026 2025

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Effective interest rate (2)(3)

5.0 % 5.1 % 5.0 % 5.1 %

(1) The average debt outstanding is a financial measure and is calculated by applying a simple average of prior months' end balances of total short-term and long-term debt, net of discounts, premiums and unamortized debt issuance costs.

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(3) We believe that this measure is useful to management, investors and other users of our financial information in evaluating our debt financing cost and trends in our debt leverage management.

Total interest expense increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily as a result of an increase in interest costs due to higher average debt balances.

Total interest expense increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily due to an increase in interest costs associated with higher average debt balances.

Provision for Income Taxes

Three Months Ended

March 31, Increase

Three Months Ended Six Months Ended

June 30, Decrease June 30, Decrease

(dollars in millions) 2026 2025 2026 2025

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The effective income tax rate is calculated by dividing the provision for income taxes by income before the provision for income taxes.

The increase in the provision for income taxes during the three months ended March 31, 2026 compared to the similar period in 2025 was primarily due to the increase in income before income taxes in the current period.

The increase in the effective income tax rate during the three months ended March 31, 2026 compared to the similar period in 2025 was primarily related to the one time impact of the Frontier acquisition.

The decrease in the provision for income taxes during the three and six months ended June 30, 2026 compared to the similar periods in 2025 was primarily due to the decrease in income before income taxes in the current period.

The increase in the effective income tax rate during the three and six months ended June 30, 2026 compared to the similar periods in 2025 was primarily related to the nondeductible loss on the classification of net assets held for sale associated with the Verizon Contributed Business in the current period.

Unrecognized Tax Benefits

Unrecognized tax benefits were $2.7 billion and $2.6 billion at March 31, 2026 and December 31, 2025, respectively.

Interest and penalties related to unrecognized tax benefits were $787 million (after-tax) and $751 million (after-tax) at March 31, 2026 and December 31, 2025, respectively.

Unrecognized tax benefits were $2.5 billion and $2.6 billion at June 30, 2026 and December 31, 2025, respectively.

Interest and penalties related to unrecognized tax benefits were $705 million (after-tax) and $751 million (after-tax) at June 30, 2026 and December 31, 2025, respectively.

Verizon Communications Inc.

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Consolidated Net Income, Consolidated EBITDA and Consolidated Adjusted EBITDA

Consolidated earnings before interest, taxes, depreciation and amortization (Consolidated EBITDA) and Consolidated Adjusted EBITDA, which are presented below, are non-GAAP financial measures that we believe are useful to management, investors and other users of our financial information in evaluating operating profitability on a more variable cost basis as they exclude the depreciation and amortization expense related primarily to capital expenditures and acquisitions, as well as in evaluating operating performance in relation to Verizon's competitors.

other users of our financial information in evaluating operating profitability on a more variable cost basis as they exclude the depreciation and amortization expense related primarily to capital expenditures and acquisitions, as well as in evaluating operating performance in relation to Verizon's competitors.

Consolidated EBITDA is calculated by adding back interest, taxes, depreciation and amortization expense to net income.

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The non-GAAP financial information presented may be determined or calculated differently by other companies and may not be directly comparable to that of other companies.

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

(dollars in millions) 2026 2025 2026 2025

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Interest expense

1,985 1,639 3,925 3,271

Depreciation and amortization expense (1)

5,008 4,635 9,900 9,212

Consolidated EBITDA $ 12,267 $ 12,883 $ 25,883 $ 25,565

Other income, net⁽²⁾ $ (36) $ (79) $ (513) $ (200)

$ (477) $ (121)

Equity in earnings of unconsolidated businesses (5) (6)

Equity in (earnings) losses of unconsolidated businesses (44) 3 (49) (3)

Severance charges 397 — 397 —

Acquisition and integration related charges 135 — 396 —

Asset rationalization 258 — 258 —

Loss on disposition of business 746 — 746 —

Consolidated Adjusted EBITDA $ 13,723 $ 12,807 $ 27,118 $ 25,362

(1) Includes Amortization of acquisition-related intangible assets, which were $240 million and $190 million during the three months ended March 31, 2026 and 2025, respectively.

(1) Includes Amortization of acquisition-related intangible assets, which were $274 million and $514 million during the three and six months ended June 30, 2026, respectively, and $192 million and $382 million during the three and six months ended June 30, 2025, respectively.

See "Special Items" for additional information.

(2) Includes Pension and benefits remeasurement gain of $237 million during the three months ended March 31, 2026.

(2) Includes Pension and benefits remeasurement gain of $237 million during the six months ended June 30, 2026.

See "Special Items" for additional information.

The changes in Consolidated Net Income, Consolidated EBITDA and Consolidated Adjusted EBITDA in the table above during the three months ended March 31, 2026 compared to the similar period in 2025 were primarily a result of the factors described above in connection with consolidated operating revenues and consolidated operating expenses.

The changes in Consolidated Net Income, Consolidated EBITDA and Consolidated Adjusted EBITDA in the table above during the three and six months ended June 30, 2026 compared to the similar periods in 2025 were primarily a result of the factors described above in connection with consolidated operating revenues and consolidated operating expenses.

Segment Results of Operations

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under the Verizon family of brands and through wholesale and other arrangements.

We also provide FWA broadband through our 5G or 4G LTE networks as an alternative to traditional landline internet access.

We also provide FWA broadband through our 5G or 4G LTE networks as an

alternative to traditional landline internet access.

Our wireline services are provided in 31 U.S.

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Operating Revenues

Three Months Ended

March 31 Increase

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

(dollars in millions)

2026 2025 2026 2025

Mobility and broadband service $ 19,637 $ 19,002 $ 635 3.3 % $ 38,817 $ 37,803 $ 1,014 2.7 %

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Total Operating Revenues $ 26,242 $ 26,648 $ (406) (1.5) $ 52,695 $ 52,266 $ 429 0.8

Consumer's total operating revenues increased during the three months ended March 31, 2026 compared to the similar period in 2025 due to increases in Mobility and broadband service revenue, Wireless equipment revenue and Other revenue.

Certain intersegment transactions with corporate entities have not been eliminated.

Consumer's total operating revenues decreased during the three months ended June 30, 2026 compared to the similar period in 2025 as a result of a decrease in Wireless equipment revenue, partially offset by increases in Mobility and broadband service revenue and Other revenue.

Consumer's total operating revenues increased during the six months ended June 30, 2026 compared to the similar period in 2025 as a result of increases in Mobility and broadband service revenue and Other revenue, partially offset by a decrease in Wireless equipment revenue.

Mobility and Broadband Service Revenue

Mobility and broadband service revenue primarily includes revenue from mobility communication services, FWA broadband, Fios internet and other fiber-based services.

Mobility and broadband service revenue increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily as a result of:

Mobility and broadband service revenue increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

The increase during the three months ended June 30, 2026 was primarily as a result of:

• an increase of $712 million in fiber broadband revenue primarily due to the inclusion of Frontier results;

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• an increase of $94 million in prepaid revenue primarily due to growth in the customer base;

• a decrease of $414 million in postpaid revenue primarily related to the amortization of wireless equipment sales promotions, credits provided to customers in connection with the network outage in the first quarter of 2026 and acquisition related discounts, partially offset by higher adoption of perks and premium MyPlan offerings.

• a decrease of $365 million in postpaid revenue primarily related to the amortization of wireless equipment sales promotions and acquisition related discounts, partially offset by higher adoption of perks, premium plan offerings and growth in FWA subscriber base.

The increase during the six months ended June 30, 2026 was primarily as a result of:

• an increase of $1.2 billion in fiber broadband revenue primarily due to the inclusion of Frontier results;

• an increase of $357 million related to growth in non-retail service revenue;

• an increase of $216 million in prepaid revenue primarily due to growth in the customer base;

• a decrease of $779 million in postpaid revenue primarily related to the amortization of wireless equipment sales promotions, acquisition related discounts and credits provided to customers in connection with the network outage in the first quarter of 2026, partially offset by higher adoption of perks, premium plan offerings and growth in FWA subscriber base.

Wireless Equipment Revenue

Wireless equipment revenue includes revenue from a variety of smartphones and other handsets, wireless-enabled internet devices, such as tablets, and other wireless-enabled connected devices, such as smart watches.

Wireless equipment revenue increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to:

• an increase of $204 million related to a shift to higher priced equipment in the mix of wireless devices sold;

• an increase of $88 million driven by a higher volume of wireless devices sold primarily related to an increase in upgrades.

Wireless equipment revenue decreased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

The decrease during the six months ended June 30, 2026 was primarily as a result of:

• a decrease of $1.0 billion driven by a lower volume of wireless devices sold primarily related to a strategic decrease in upgrades;

• an increase of $110 million due to a shift to higher priced equipment in the mix of wireless devices sold.

Other Revenue

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Other revenue also includes fees that partially recover the direct and indirect costs of complying with regulatory and industry obligations and programs, leasing and interest recognized when equipment is sold to the customer by an authorized agent under a device payment plan agreement.

Other revenue increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to an increase of $133 million in legacy wireline revenue related to the inclusion of Frontier results.

Other revenue increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily due to an increase of $140 million and $273 million, respectively, in legacy wireline revenue related to the inclusion of Frontier results.

Operating Expenses

Three Months Ended

March 31, Increase/(Decrease)

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

(dollars in millions) 2026 2025 2026 2025

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Cost of Services

Cost of services increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to:

• an increase of $114 million in personnel costs mainly driven by an increase in employee headcount following the acquisition of Frontier;

• an increase of $71 million in building and facility costs primarily due to higher utility rates along with maintaining additional buildings and facilities due to the acquisition of Frontier in 2026.

Cost of services increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily due to:

• an increase of $150 million and $264 million, respectively, in personnel costs mainly driven by an increase in employee headcount following the acquisition of Frontier;

• an increase of $111 million and $150 million, respectively, in digital content costs primarily associated with an increase in subscriptions through plan offerings and the inclusion of Frontier results, partially offset by a decrease in traditional linear content costs related to lower Fios video volumes;

• an increase of $54 million and $125 million, respectively, in building and facility costs primarily due to maintaining additional buildings and facilities associated with the acquisition of Frontier in 2026 along with higher utility rates.

Cost of Wireless Equipment

Cost of wireless equipment increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to:

Cost of wireless equipment decreased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

The decrease during the six months ended June 30, 2026 was primarily as a result of:

• a decrease of $991 million driven by a lower volume of wireless devices sold primarily related to a strategic decrease in upgrades;

• an increase of $233 million due to a shift to higher priced equipment in the mix of wireless devices sold.

• an increase of $121 million driven by a higher volume of wireless devices sold primarily related to an increase in upgrades.

Selling, General and Administrative Expense

Selling, general and administrative expense decreased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to a decrease of $257 million in advertising costs related to various marketing campaigns in the first quarter of 2025 that did not reoccur.

Selling, general and administrative expense decreased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily as a result of:

• a decrease of $184 million and $441 million, respectively, in advertising costs related to various marketing campaigns in the first half of 2025 that did not reoccur;

• a decrease of $104 million and $127 million, respectively, in provision for credit losses primarily related to lower upgrade volumes;

• an increase of $120 million and $178 million, respectively, in personnel costs mainly driven by an increase in commission expense due to higher volumes in our prepaid business, partially offset by workforce reduction initiatives.

Depreciation and Amortization Expense

Depreciation and amortization expense increased during the three months ended March 31, 2026 compared to the similar period in 2025 driven by the change in the mix of total Verizon depreciable and amortizable assets, including the impact of depreciable assets acquired as part of the Frontier acquisition, and Consumer's usage of those assets.

Depreciation and amortization expense increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 driven by the change in the mix of total Verizon depreciable and amortizable assets, including the impact of depreciable assets acquired as part of the Frontier acquisition, and Consumer's usage of those assets.

Segment Operating Income and Segment EBITDA

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Segment EBITDA margin is calculated by dividing Segment EBITDA by total segment operating revenues.

Three Months Ended

March 31, Increase

Three Months Ended Six Months Ended

June 30, Increase June 30, Increase

(dollars in millions) 2026 2025 2026 2025

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Segment operating income margin is calculated by dividing total segment operating income by total segment operating revenues.

The changes in the table above during the three months ended March 31, 2026 compared to the similar period in 2025 were primarily a result of the factors described in connection with Consumer operating revenues and operating expenses.

The changes in the table above during the three and six months ended June 30, 2026 compared to the similar periods in 2025 were primarily a result of the factors described in connection with Consumer operating revenues and operating expenses.

Verizon Business Group

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and a subset of these products and services to customers around the world.

In the second quarter of 2026, the net assets representing the Verizon Contributed Business were classified as assets and liabilities held for sale and moved from the Business segment to Corporate and other.

Where applicable, historical segment results have been reclassified to conform to the current period presentation.

See Note 3 to the condensed consolidated financial statements for additional information.

Operating Revenues

Three Months Ended

March 31, Increase/(Decrease)

(dollars in millions) 2026 2025

Three Months Ended Six Months Ended

June 30, Increase/ June 30, Increase/(Decrease)

(dollars in millions) 2026 2025 (Decrease) 2026 2025

Mobility and broadband service $ 3,728 $ 3,733 $ (5) (0.1) % $ 7,416 $ 7,450 $ (34) (0.5) %

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$ 7,155 $ 6,973 $ 182 2.6 $ 14,285 $ 13,975 $ 310 2.2

Business's total operating revenues increased during the three months ended March 31, 2026 compared to the similar period in 2025 as a result of an increase in Other revenue, partially offset by decreases in Mobility and broadband service revenue and Wireless equipment revenue.

Certain intersegment transactions with corporate entities have not been eliminated.

Business's total operating revenues increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 as a result of an increase in Other revenue, partially offset by decreases in Wireless equipment revenue and Mobility and broadband service revenue.

Mobility and Broadband Service Revenue

Mobility and broadband service revenue primarily includes revenue from mobility communication services, FWA broadband, Fios internet and other fiber-based services.

Mobility and broadband service revenue remained relatively flat during the three months ended March 31, 2026 compared to the similar period in 2025.

Mobility and broadband service revenue decreased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily as a result of:

• a decrease of $75 million and $155 million, respectively, in postpaid service revenue primarily due to a shift toward lower-tier plans among new customers and the amortization of wireless equipment sales promotions.

These decreases were partially offset by FWA subscriber growth and strategic pricing adjustments for existing customers;

• an increase of $60 million and $105 million, respectively, in fiber broadband revenue primarily due to the inclusion of Frontier results.

Wireless Equipment Revenue

Wireless equipment revenue remained relatively flat during the three months ended March 31, 2026 compared to the similar period in 2025.

Wireless equipment revenue remained relatively flat during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

Other Revenue

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Other revenue increased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to an increase of $221 million in legacy wireline revenue related to the inclusion of Frontier results.

Other revenue increased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily due to an increase of $277 million and $494 million, respectively, in legacy wireline revenue related to the inclusion of Frontier results.

Operating Expenses

Three Months Ended

March 31, Increase/(Decrease)

Three Months Ended Six Months Ended

June 30, Increase/(Decrease) June 30, Increase/(Decrease)

(dollars in millions) 2026 2025 2026 2025

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Cost of Services

Cost of services decreased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily as a result of:

• a decrease of $91 million in access costs primarily related to cessation of certain third-party provider costs along with a decrease in circuit usage;

• an increase of $51 million in personnel costs associated with third-party contracted resources.

Cost of services decreased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily as a result of:

• a decrease of $121 million and $210 million, respectively, in access costs primarily related to cessation of certain third-party provider costs along with a decrease in circuit usage;

• an increase of $54 million and $100 million, respectively, in personnel costs associated with third-party contracted resources.

Cost of Wireless Equipment

Cost of wireless equipment remained relatively flat during the three months ended March 31, 2026 compared to the similar period in 2025.

Cost of wireless equipment remained relatively flat during both the three and six months ended June 30, 2026 compared to the similar periods in 2025.

Selling, General and Administrative Expense

Selling, general and administrative expense decreased during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to a decrease of $167 million in personnel costs related to workforce reduction initiatives announced in the prior year.

Selling, general and administrative expense decreased during both the three and six months ended June 30, 2026 compared to the similar periods in 2025 primarily due to a decrease of $139 million and $294 million, respectively, in personnel costs related to workforce reduction initiatives.

Depreciation and Amortization Expense

Segment Operating Income and Segment EBITDA

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See “Segment Results of Operations — Verizon Consumer Group — Segment Operating Income and Segment EBITDA” for additional details.

Three Months Ended

March 31, Increase

Three Months Ended Six Months Ended

June 30, Increase June 30, Increase

(dollars in millions) 2026 2025 2026 2025

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Segment operating income margin (1)

13.9 % 10.4 % 13.6 % 10.5 %

Segment EBITDA margin 29.1 % 24.7 % 28.6 % 24.7 %

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Segment operating income margin is calculated by dividing total segment operating income by total segment operating revenues.

The changes in the table above during the three months ended March 31, 2026 compared to the similar period in 2025 were primarily a result of the factors described in connection with Business operating revenues and operating expenses.

The changes in the table above during the three and six months ended June 30, 2026 compared to the similar periods in 2025 were primarily a result of the factors described in connection with Business operating revenues and operating expenses.

Special Items

Special items included in Income Before Provision For Income Taxes were as follows:

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

(dollars in millions) 2026 2025 2026 2025

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Depreciation and amortization expense $ 274 $ 192 $ 514 $ 382

Severance, pension and benefits charges

Selling, general and administrative expense

Other (income) expense, net — — (237) —

Acquisition and integration related charges

Selling, general and administrative expense 135 — 396 —

Pension and benefits credits

Other income, net (237) —

Asset rationalization

Cost of Services

Selling, general and administrative expense

Loss on disposition of business

Selling, general and administrative expense

Total $ 1,810 $ 192 $ 2,074 $ 382

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The income and expenses related to special items included in our condensed consolidated results of operations were as follows:

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

(dollars in millions) 2026 2025 2026 2025

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Amortization of Acquisition-Related Intangible Assets

During the three months ended March 31, 2026, and 2025 we recorded pre-tax amortization expense of $240 million and $190 million, respectively, related to acquired intangible assets.

During the three and six months ended June 30, 2026, we recorded pre-tax amortization expense of $274 million and $514 million, respectively, related to acquired intangible assets.

During the three and six months ended June 30, 2025, we recorded pre-tax amortization expense of $192 million and $382 million, respectively, related to acquired intangible assets.

Severance, Pension and Benefits Charges

During the three and six months ended June 30, 2026, we recorded pre-tax severance charges of $397 million, exclusive of acquisition related severance charges, principally as a result of separations in connection with our workforce reduction initiatives.

The severance charges were recorded in Selling, general and administrative expense in our condensed consolidated statements of income.

During the six months ended June 30, 2026, we recorded a net pre-tax pension and benefits remeasurement gain of $237 million in certain pension and postretirement benefit plans resulting from amendments to our collective bargaining agreements.

This was primarily driven by a credit of $412 million due to an increase in our discount rate assumption used to determine the current year liabilities of certain pension and postretirement benefit plans, partially offset by a charge of $175 million primarily resulting from the difference between our estimated and our actual return on certain pension plan assets.

Acquisition and Integration Related Charges

During the three months ended March 31, 2026, we recorded charges of $261 million related to transaction and integration expenses associated with the acquisition of Frontier.

Pension and Benefits Credits

During the three months ended March 31, 2026, we recorded a net pre-tax pension and benefits remeasurement gain of $237 million in certain pension and postretirement benefit plans resulting from amendments to our collective bargaining agreements.

This was primarily driven by a gain of $412 million due to an increase in our discount rate assumption used to determine the current year liabilities of certain pension and postretirement benefit plans, partially offset by a loss of $175 million primarily resulting from the difference between our estimated and our actual return on certain pension plan assets.

During the three and six months ended June 30, 2026, we recorded charges of $135 million and $396 million, respectively, inclusive of acquisition related severance charges, related to transaction and integration expenses primarily associated with the acquisition of Frontier.

Asset Rationalization

During both the three and six months ended June 30, 2026, we recorded pre-tax asset rationalization charges of $258 million predominately related to the decision to cease use of certain real estate and network assets as part of our transformation initiatives.

Loss on Disposition of Business

During both the three and six months ended June 30, 2026, we recorded a pre-tax loss on disposition of business of $746 million in connection with the classification of the assets and liabilities representing the Verizon Contributed Business as assets and liabilities held for sale.

Pursuant to the Transaction Agreement, dated as of June 28, 2026, the Verizon Contributed Business is expected to be contributed to a joint venture with BT.

See Note 3 to the condensed consolidated financial statements for additional information on the transaction.

Consolidated Financial Condition

Three Months Ended

Six Months Ended

(dollars in millions) 2026 2025 Change

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Our primary source of funds continues to be cash generated from operations.

Net cash provided by operating activities increased $202 million during the three months ended March 31, 2026 compared to the similar period in 2025 primarily due to an increase in earnings.

In April 2026, we made an insignificant required contribution to our recently acquired Frontier Communications pension plan.

We expect that there will be an additional insignificant required pension contribution through December 31, 2026.

Net cash provided by operating activities increased $1.7 billion during the six months ended June 30, 2026 compared to the similar period in 2025.

The increase is primarily

attributable to the timing of cash tax payments as a result of the One Big Beautiful Bill legislation and working capital benefits primarily related to lower upgrade volumes, partially offset by a decrease in earnings.

Cash Flows Used In Investing Activities

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Capital expenditures continue to relate primarily to the use of capital resources to enhance the operating efficiency and productivity of our networks, maintain our existing infrastructure, facilitate the introduction of new products and services and enhance responsiveness to competitive challenges.

Capital expenditures, including capitalized software, for the three months ended March 31, 2026 and 2025 were $4.2 billion and $4.1 billion, respectively.

Capital expenditures increased $56 million during the three months ended March 31, 2026 compared to the similar period in 2025.

Capital expenditures, including capitalized software, for the six months ended June 30, 2026 and 2025 were $8.2 billion and $8.0 billion, respectively.

Capital expenditures increased $257 million during the six months ended June 30, 2026 compared to the similar period in 2025 primarily due to fiber and wireless network infrastructure investments.

Acquisitions of Businesses, Net of Cash Acquired

During the three months ended March 31, 2026, we invested $9.5 billion in acquisitions of businesses, net of cash acquired.

During the six months ended June 30, 2026, we invested $9.5 billion in acquisitions of businesses, net of cash acquired.

In January 2026, we completed the acquisition of Frontier, a U.S.

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Acquisitions of Wireless Licenses

During the three months ended March 31, 2026 and 2025, we recorded capitalized interest related to wireless licenses of $82 million and $122 million, respectively.

During the six months ended June 30, 2026, we completed the acquisition of select spectrum licenses of United States Cellular Corporation (currently known as Array Digital Infrastructure, Inc.) and certain of its subsidiaries (collectively, UScellular) for total cash consideration of $1.0 billion.

During the six months ended June 30, 2026 and 2025, we recorded capitalized interest related to wireless licenses of $154 million and $234 million, respectively.

Cash Flows Used In Financing Activities

We seek to maintain a mix of fixed and variable rate debt to lower borrowing costs within reasonable risk parameters and to protect against earnings and cash flow volatility resulting from changes in market conditions.

During the three months ended March 31, 2026, net cash used in financing activities was $5.3 billion.

During the three months ended March 31, 2025, net cash used in financing activities was $5.9 billion.

During the three months ended March 31, 2026, our net cash used in financing activities was primarily driven by repayments of asset-backed long-term borrowings of $6.8 billion, repayments and repurchases of long-term borrowings and finance lease obligations of $4.3 billion, cash dividends paid of $2.9 billion and payments to purchase shares of our common stock of $2.5 billion.

The repayments during the three months ended March 31, 2026 included approximately $6.4 billion for the principal amount of debt assumed as a part of the acquisition of Frontier.

We expect to continue to repay the assumed debt from the Frontier acquisition throughout 2026.

During the six months ended June 30, 2026, net cash used in financing activities was $17.1 billion.

During the six months ended June 30, 2025, net cash used in financing activities was $10.3 billion.

During the six months ended June 30, 2026, our net cash used in financing activities was primarily driven by repayments, redemptions and repurchases of long-term borrowings and finance lease obligations of $14.4 billion, repayments of asset-backed long-term borrowings of $13.9 billion, cash dividends paid of $5.9 billion and payments to purchase shares of our common stock of $3.5 billion.

The repayments during the six months ended June 30, 2026 included approximately $12.4 billion for the principal amount of debt assumed as a part of the acquisition of Frontier.

These payments were partially offset by proceeds from asset-backed long-term borrowings of $12.0 billion and proceeds from long-term borrowings of $9.9 billion.

At March 31, 2026, our total debt of $172.5 billion included unsecured debt of $142.5 billion and secured debt of $30.0 billion.

At June 30, 2026, our total debt of $165.2 billion included unsecured debt of $136.5 billion and secured debt of $28.8 billion.

At December 31, 2025, our total debt of $158.2 billion included unsecured debt of $131.1 billion and secured debt of $27.1 billion.

During the three months ended March 31, 2026 and 2025, our effective interest rate was 5.0% and 5.1%, respectively.

During the six months ended June 30, 2026 and 2025, our effective interest rate was 5.0% and 5.1%, respectively.

See Note 5 to the condensed consolidated financial statements for additional information regarding our debt activity, which excludes the impact from mark-to-market adjustments on foreign currency denominated debt.

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Long-Term Credit Facilities

At March 31, 2026

At June 30, 2026

(dollars in millions) Maturities Facility Capacity Unused Capacity Principal Amount Outstanding

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The revolving credit facility provides for the issuance of letters of credit.

As of March 31, 2026 , there have been no drawings against the revolving credit facility since its inception.

(2) During the three months ended March 31, 2026 , we drew down approximately $1.6 billion.

During the three months ended March 31, 2025, there were no drawings from these facilities.

As of June 30, 2026 , there have been no drawings against the revolving credit facility since its inception.

(2) During the six months ended June 30, 2026 , we drew down approximately $1.6 billion.

During the six months ended June 30, 2025, there were no drawings from these facilities.

Borrowings under certain of these facilities are repaid semi-annually in equal installments up to the applicable maturity dates.

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Any amounts borrowed under these facilities and subsequently repaid cannot be reborrowed.

Other, net cash flow from financing activities during the three months ended March 31, 2026 includes $450 million in payments related to vendor financing arrangements, $264 million in payments related to tax withholding of employee share based arrangements and $126 million in payments made under the sublease arrangement for our cell towers.

Other, net cash flow from financing activities during the six months ended June 30, 2026 includes $983 million in payments related to vendor financing arrangements, $279 million in payments related to tax withholding of employee share based arrangements, $254 million in payments made under the sublease arrangement for our cell towers and $217 million in equity distribution payments made for controlled entities.

These payments were partially offset by $358 million in advance proceeds received from the variable prepaid forward entered into in 2026.

As in prior periods, dividend payments were a significant use of capital resources.

We paid $2.9 billion in cash dividends during both the three months ended March 31, 2026 and 2025.

We paid $5.9 billion and $5.7 billion in cash dividends during the six months ended June 30, 2026 and 2025, respectively.

On January 30, 2026, the Board of Directors of the Company authorized a share repurchase program for up to $25 billion of our common stock.

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In February 2026, we entered into accelerated share repurchase (ASR) agreements with certain financial institution counterparties to repurchase shares of our common stock in exchange for an upfront payment of $2.5 billion and received an initial delivery of 45,116,772 shares of common stock using a reference price of $47.10.

In March 2026, the ASR transactions were completed, and we received an additional 5,641,251 shares.

In March 2026, these ASR transactions were completed, and we received an additional 5,641,251 shares.

This resulted in a total of 50,758,023 shares repurchased under the ASR agreements at an average repurchase price of $49.25, not including related excise tax.

The initial and additional shares received under the ASR agreements were excluded from the outstanding shares used to calculate the weighted average common shares outstanding for basic and diluted earnings per share from the date the respective shares were received by the Company and classified as treasury shares.

At March 31, 2026, the maximum remaining aggregate consideration that could be paid by or on behalf of Verizon under our share repurchase program was $22.5 billion.

Our credit agreements contain covenants that are typical for large, investment grade companies.

In April 2026, we entered into an ASR agreement with a certain financial institution counterparty to repurchase shares of our common stock in exchange for an upfront payment of $1.0 billion and received an initial delivery of 17,993,226 shares of common stock using a reference price of $47.24.

In June 2026, the ASR transaction was completed, and we received an additional 3,296,217 shares.

This resulted in a total of 21,289,443 shares repurchased under the ASR agreement at an average repurchase price of $46.97, not including related excise tax.

For the six months ended June 30, 2026, we repurchased a total of 72,047,466 shares for an aggregate payment of $3.5 billion.

All shares received under the ASR agreements were excluded from the outstanding shares used to calculate the weighted average common shares outstanding for basic and diluted earnings per share from the date the respective shares were received by the Company and classified as treasury shares.

At June 30, 2026, the maximum remaining aggregate consideration that could be paid by or on behalf of Verizon under our share repurchase program was $21.5 billion.

For the full year 2026, our share repurchase target has been increased from $3.0 billion to up to $4.5 billion.

Our debt agreements contain covenants that are typical for large, investment grade companies.

These covenants include requirements to pay interest and principal in a timely fashion, pay taxes, maintain insurance with responsible and reputable insurance companies, preserve our corporate existence, keep appropriate books and records of financial transactions, maintain our properties, provide financial and other reports to our lenders, limit pledging and disposition of assets and mergers and consolidations, and other similar covenants.

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Change In Cash, Cash Equivalents and Restricted Cash

Our Cash and cash equivalents at March 31, 2026 totaled $8.4 billion, a $10.7 billion decrease compared to December 31, 2025, primarily as a result of the factors discussed above.

Restricted cash totaled $266 million and $451 million as of March 31, 2026 and December 31, 2025, respectively, primarily related to cash collections on certain receivables and on the underlying receivables related to the participation interest that are required at certain specified times to be placed into segregated accounts.

Our Cash and cash equivalents at June 30, 2026 totaled $1.8 billion, a $17.3 billion decrease compared to December 31, 2025, primarily as a result of the factors discussed above.

Restricted cash totaled $302 million and $451 million as of June 30, 2026 and December 31, 2025, respectively, primarily related to cash collections on certain receivables and on the underlying receivables related to the participation interest that are required at certain specified times to be placed into segregated accounts.

As of June 30, 2026, we classified $250 million of cash and cash equivalents as assets held for sale relating to the Verizon Contributed Business.

See Note 3 to the condensed consolidated financial statements for additional information.

Free Cash Flow

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The following table reconciles net cash provided by operating activities to free cash flow:

Three Months Ended

Six Months Ended

(dollars in millions) 2026 2025 Change

2 unchanged sentences

Free cash flow $ 10,209 $ 8,804 $ 1,405

The increase in free cash flow during the three months ended March 31, 2026 compared to the similar period in 2025 is a reflection of the increase in operating cash flows, partially offset by the increase in capital expenditures, both of which are discussed above.

The increase in free cash flow during the six months ended June 30, 2026 compared to the similar period in 2025 is a reflection of the increase in operating cash flows, partially offset by the increase in capital expenditures, both of which are discussed above.

We are exposed to various types of market risk in the normal course of business, including the impact of interest rate changes, foreign currency exchange rate fluctuations, changes in investment, equity and commodity prices and changes in corporate tax rates.

We employ risk management strategies, which may include the use of a variety of derivatives including cross currency swaps, forward starting interest rate swaps, interest rate swaps, interest rate caps, treasury rate locks and foreign exchange forwards.

We employ risk management strategies, which may include the use of a variety of derivatives including interest rate swaps, cross currency swaps, forward starting interest rate swaps, treasury rate locks, interest rate caps and foreign exchange forwards.

We do not hold derivatives for trading purposes.

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The CSA agreements contain fixed cap amounts or rating based thresholds such that we or our counterparties may be required to hold or post collateral based upon changes in outstanding positions as compared to established thresholds or caps and changes in credit ratings.

We do not offset fair value amounts recognized for derivative instruments and fair value amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral arising from derivative instruments recognized at fair value.

At both March 31, 2026 and December 31, 2025, we did not hold any collateral.

At both March 31, 2026 and December 31, 2025, we posted $1.1 billion of collateral related to derivative contracts under collateral exchange agreements, which were recorded as Prepaid expenses and other in our condensed consolidated balance sheets.

We do not offset fair value amounts recognized for derivative instruments and fair value amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral

arising from derivative instruments recognized at fair value.

At both June 30, 2026 and December 31, 2025, we did not hold any collateral.

At both June 30, 2026 and December 31, 2025, we posted $1.1 billion of collateral related to derivative contracts under collateral exchange agreements, which were recorded as Prepaid expenses and other in our condensed consolidated balance sheets.

While we may be exposed to credit losses due to the nonperformance of our counterparties, we consider the risk remote and do not expect that any such nonperformance would result in a significant effect on our results of operations or financial condition due to our diversified pool of counterparties.

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We are exposed to changes in interest rates, primarily on our short-term debt and the portion of long-term debt that carries floating interest rates.

As of March 31, 2026, approximately 79% of the aggregate principal amount of our total debt portfolio consisted of fixed-rate indebtedness, including the effect of interest rate swap agreements designated as hedges.

As of June 30, 2026, approximately 76% of the aggregate principal amount of our total debt portfolio consisted of fixed-rate indebtedness, including the effect of interest rate swap agreements designated as hedges.

The impact of a 100-basis-point change in interest rates affecting our floating rate debt would result in a change in annual interest expense, including our interest rate swap agreements that are designated as hedges, of approximately $412 million.

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These swaps are designated as fair value hedges and hedge against interest rate risk exposure of designated debt issuances.

At March 31, 2026 and December 31, 2025, the fair value of the liability of these contracts was $5.0 billion and $5.1 billion, respectively.

At both March 31, 2026 and December 31, 2025, the total notional amount of the interest rate swaps was $23.7 billion.

At June 30, 2026 and December 31, 2025, the fair value of the liability of these contracts was $5.2 billion and $5.1 billion, respectively.

At both June 30, 2026 and December 31, 2025, the total notional amount of the interest rate swaps was $23.7 billion.

Foreign Currency Risk

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Gains and losses on foreign currency transactions are recorded in the condensed consolidated statements of income.

At March 31, 2026, our primary translation exposure was to the British Pound Sterling, Euro, Australian Dollar and Swedish Krona.

At June 30, 2026, our primary translation exposure was to the British Pound Sterling, Euro, Australian Dollar and Swedish Krona.

Cross Currency Swaps

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dollars, as well as to mitigate the impact of foreign currency transaction gains or losses.

At March 31, 2026 and December 31, 2025, the fair value of the asset of these contracts was $1.0 billion and $1.4 billion, respectively.

At March 31, 2026 and December 31, 2025, the fair value of the liability of these contracts was $1.6 billion and $1.2 billion, respectively.

At March 31, 2026 and December 31, 2025, the total notional amount of the cross currency swaps was $40.5 billion and $36.1 billion, respectively.

At June 30, 2026 and December 31, 2025, the fair value of the asset of these contracts was $1.2 billion and $1.4 billion, respectively.

At June 30, 2026 and December 31, 2025, the fair value of the liability of these contracts was $1.4 billion and $1.2 billion, respectively.

At June 30, 2026 and December 31, 2025, the total notional amount of the cross currency swaps was $40.2 billion and $36.1 billion, respectively.

Foreign Exchange Forwards

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We entered into Euro foreign exchange forwards to mitigate our foreign exchange rate risk related to non-functional currency denominated monetary assets and liabilities of international subsidiaries.

At both March 31, 2026 and December 31, 2025, the fair value of the asset and liability of these contracts was insignificant.

At March 31, 2026 and December 31, 2025, the total notional amount of the foreign exchange forwards was $590 million and $570 million, respectively.

At both June 30, 2026 and December 31, 2025, the fair value of the asset and liability of these contracts was insignificant.

At June 30, 2026 and December 31, 2025, the total notional amount of the foreign exchange forwards was $600 million and $570 million, respectively.

Acquisitions and Divestitures

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We believe these spectrum license transactions have allowed us to continue to enhance the reliability of our wireless network while also resulting in a more efficient use of spectrum.

On October 17, 2024, Verizon entered into a license purchase agreement to acquire select spectrum licenses of United States Cellular Corporation (currently known as Array Digital Infrastructure, Inc.) and certain of its subsidiaries (collectively, UScellular) for total consideration of $1.0 billion, subject to certain potential adjustments.

The closing of this transaction is subject to the receipt of regulatory approvals and other closing conditions, including the sale of UScellular's wireless operations and select spectrum assets to T-Mobile US, Inc., which concluded in August 2025, and the termination of certain post-closing arrangements with respect to that sale.

On October 17, 2024, Verizon entered into a license purchase agreement to acquire select spectrum licenses of UScellular.

On June 1, 2026, we completed the acquisition of the spectrum licenses for total cash consideration of $1.0 billion.

In June 2026, the Federal Communications Commission (FCC) concluded Auction 113 for Advanced Wireless Services (AWS-3) licenses.

Verizon paid an immaterial cash deposit to participate in the auction, and was the winning bidder on 82 spectrum licenses valued at approximately $3.2 billion.

In July 2026, we made additional payments totaling $3.1 billion in connection with these licenses.

The timing of the license issuance remains subject to FCC determination.

Joint Venture with BT Group plc

On June 28, 2026, the Company entered into the Transaction Agreement with BT and NewCo, pursuant to which, the Company and BT will each acquire a 50% equity interest in NewCo.

As consideration, the Company will contribute the equity interests of certain subsidiaries comprising the Verizon Contributed Business and make a $625 million cash payment to NewCo, which NewCo will distribute to BT.

BT will contribute the equity interests of certain subsidiaries comprising its international wireline connectivity and managed network services business (the BT Contributed Business) to NewCo.

The relative values of the Verizon Contributed Business and the BT Contributed Business are subject to customary post-closing adjustments based on the levels of cash, net working capital, and indebtedness of each business at closing.

The Transaction Agreement contemplates the entry into a joint venture agreement between the Company, BT and NewCo in respect of the governance of NewCo, as well as certain ancillary commercial agreements and transition services arrangements.

C losing of the transaction is subject to customary regulatory approvals and other closing conditions.

Frontier Communications Parent, Inc.

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The financial results of Frontier and Starry are included in the Company’s consolidated results from January 20, 2026 and January 30, 2026, respectively.

The aggregate operating revenues arising from these acquisitions and included in our condensed

consolidated statements of income amounted to less than 5% of total operating revenues for the three months ended March 31, 2026.

The aggregate operating revenues arising from these acquisitions and included in our condensed consolidated statements of income amounted to less than 5% of total operating revenues for both the three and six months ended June 30, 2026.

See Note 3 to the condensed consolidated financial statements for additional information.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis