Verizon Communications Inc. (VZ) and Apple (AAPL) recently introduced a new program intended for promoting mass adoption of 5G with the newly launched iPhone 12.
5G for businesses
The new program, called “5G fleet Swap,” is rolled out for big enterprises that use a mobile network in their business operations. The company offers to replace the entire fleet of mobile phones in an enterprise with any newly released version of iPhone. The businesses can avail the opportunity at zero upfront cost.
The latest program is a part of Verizon’s overall efforts to shift more customers to 5G enabled phones so that it can benefit from its extensive 5G roll-out efforts. The company is trying to speed up digital transformation with its new super-fast and low-latency services. But it is starting with big enterprises. For instance, it recently installed 5G at a vehicle assembly plant of General Motors. Moreover, Honeywell International is also using Verizon’s 5G at its headquarters located in Charlotte.
Apple is also an indirect beneficiary of Verizon’s efforts to bring more people to its 5G network. The iPhone maker has not seen a significant jump in the sales of its flagship product in the recent quarters. So, even for Apple, 5G offers a great opportunity to boost sales of its newly released iPhone models that support the next-generation wireless network. Even adding a handful of big businesses in the newly launched program could positively impact iPhone sales.
Verizon 5G expansion
With the latest addition, people in 57 cities can now switch to 5G devices and enjoy the ultra-fast wireless speed that can hit up to 4Gbps in certain locations under the ideal scenario. The next level speed can help users download their favorite movies in seconds, or even stream them online in the blink of an eye. Enterprise customers can also benefit from the 5G network, particularly to ensure a smooth experience while conducting a videoconference with employees or remotely monitoring a facility or a workplace in real-time.
The company’s chief technology officer Kyle Malady said in a statement “Verizon continues its aggressive expansion of 5G Ultra-Wideband service, adding to the growing list of cities with access to the amazing new capabilities this technology brings.”
The company plans to roll out 5 Ultra-Wideband in 3 more cities by the end of this year that will bring the total to 60 cities. Verizon is leading the 5G race, while many others are also trying to benefit from the 5G evolution. Its 5G Ultra-Wideband is expected to handle data volumes multiple times faster than the existing 4G network.
Verizon 5G Home Internet
A senior executive at Verizon
The next generation home internet service is intended for employees and students that are forced to work from home due to the pandemic. The company claims that users can get a download speed of as much as 1Gbps in certain areas, while the normal download speed offered by the service is around 300 Mbps.
Verizon customers can subscribe to the 5G Home Internet service for $50 per month, lower than $70 per month for non-Verizon customers.
The company reported a net income of $1.05 per share for the quarter, as compared to $1.25 per share in the comparable period of 2019. On an adjusted basis, profit came in at $1.25 per share, nearly flat as compared to the year-ago quarter.
Revenue for the quarter fell 4.1 percent to $31.5 billion. The company blamed the drop on weak customer activity and the rescheduling of the launch time of certain devices.
On the bright side, cash flow from operations increased to $32.5 billion in the third quarter, which translates to an addition of $5.7 billion on a year-over-year basis. The surge was mainly helped by the consistency and strength of the business and improvement in working capital amid lower volumes.
The company’s capital expenditure stood at $14.2 billion by the end of the third quarter, as it continues to spend on expanding its 5G Ultra-Wideband network along with some upgrades.
If we look at the revenue performance of key units, revenue at the consumer segment decreased 4.3 percent to $21.7 billion in the third quarter. The drop was mainly attributed to a decline in wireless equipment sales due to the pandemic. Comparatively, revenue at the business segment slipped 1.7 percent to $7.7 billion
On the other hand, revenue from the media segment came in at $1.7 billion, representing a drop of 7.4 percent on a year-over-year basis. However, media revenue was up more than 21 percent when compared to the second quarter of 2020.
Moreover, the company expects its wireless services sales to increase by at least 2 percent in the fourth quarter, as compared to the fourth quarter of 2019.
Verizon stock performance