Verizon reported it lost 68,000 postpaid subscribers in the first quarter as the COVID-19 pandemic swept across the country, impacting everything from retail stores to roaming revenues.
The company closed 70% of its wireless retail stores during the quarter and reduced hours of operations at those locations that remained open.
From March 15 to April 15, postpaid gross adds were down almost 50%; upgrades were down 41%.
Revenue declined 1.6% on a year-over-year basis as a segment of customers were unable to pay their bills. Total postpaid churn was lower, at 1.08%, as people weren’t game to switch carriers much.
The company updated its guidance on full-year adjusted earnings per share to -2% to +2%, a change from its earlier expectation of growth of 2% to 4%.
CEO Hans Vestberg stressed during the company's earnings call on Friday that the fundamentals remain strong for the business and the network is holding up well to handle usage demands. “We are on plan with the 5G and fiber,” he said.
Of course, there are challenges with COVID-19, but the team is finding new ways to get siting approvals from municipalities, including digitally, he said.
About 800,000 customers have indicated that COVID-19 is impacting their ability to pay their bills, although that doesn’t mean they’re going to stop paying completely.
Compared to some numbers emerging in the mortgage and auto loan areas, “we’re seeing a better overall performance in terms of the customer payment profile” and that’s consistent with what happened in the financial crisis of 2008 as well, said CFO Matt Ellis. “We have a very important product for our customers and they value it.”
Verizon actually revised on March 12 its capital expenditures for the year upwards, saying it plans to spend $17.5 billion to $18.5 billion compared to earlier guidance of $17 billion to $18 billion.