Why Verizon Stock Is Gaining Today

Verizon (NYSE: VZ) stock is climbing Friday following the company's fourth-quarter earnings release. The telecom company's share price was up 1.3% as of 12:15 p.m. ET and had been up as much as 3.9% earlier in the daily session.

Verizon published its Q4 report before the market opened, posting earnings that were in line with Wall Street's expectations and sales that beat the target. The company posted adjusted non-GAAP (generally accepted accounting principles) earnings per share of $1.10 on sales of $35.7 billion. Meanwhile, the average analyst estimate had called for sales of roughly $35.34 billion in the period.

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Verizon stock climbs on solid Q4 numbers

Verizon's revenue climbed 1.7% year over year in the fourth quarter, powered by solid mobile wireless and internet-service customer-addition numbers. In the mobile wireless category, the company added 568,000 net postpaid phone additions in the quarter -- representing an acceleration from the 449,000 net adds it posted in the prior-year quarter. Revenue for the segment increased 3.1% year over year to reach $20 billion, marking its 18th consecutive quarter of sequential growth.

On the internet side of things, the company reported 408,000 net broadband service additions and 373,000 additions for fixed wireless. Meanwhile, Fios net additions came in at 51,000 -- down from 55,000 in the Q4 2023. The company closed out last year with 12.3 million total broadband service connections -- up 15% year over year.-

What comes next for Verizon?

With its Q4 report today, Verizon also announced that it closed out the period with total unsecured debt of $117.9 billion, representing an $8.5 billion decline from where it stood in the previous quarter. The company has continued to post solid results and make progress paying down its debt. On the other hand, the telecom space continues to be highly competitive -- and new entrants are entering key markets for Verizon.

To its credit, Verizon isn't standing still. It's aiming to shore up its competitive positioning and open up some new growth channels through its acquisition of Frontier Communications -- which is expected to close in the first quarter of next year. The extent to which the $20 billion deal winds up being successful will have a significant impact on Verizon stock over the next five years.

The company is also looking to artificial intelligence (AI) as a key growth driver, and it's possible that partnerships with Nvidia, Alphabet, and Meta Platforms could wind up yielding some significant performance catalysts.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, and Nvidia. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy.