Verizon CEO Warns of Continuing Uncertainty From Trump Tariffs
Changes wrought by President Donald Trump’s return to the White House are already affecting telecom industry financials. Verizon CEO Hans Vestberg noted the risks from tariffs on a call with analysts Tuesday after the company released Q1 results. The nation’s largest wireless provider reported a net loss of 289,000 monthly prepaid phone subscribers in the quarter, after adding 568,000 in Q4 2024.
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Vestberg was repeatedly asked by analysts about the challenges posed by tariffs. “I don't think anybody is relaxed on tariffs, given … the volatility,” he said, calling them “a little bit of a moving target.” On its network build, Vestberg noted that Verizon was able to navigate its way through supply chain interruptions during the COVID-19 pandemic and is prepared to deal with volatile pricing this year.
With China facing higher tariffs than other nations, Vestberg said it’s unclear what the effect will be on handsets. Many consumer electronics are manufactured in China, including most iPhones. It’s “very early to say where the tariff is going to go and what's going to happen.” If tariffs end up as high as some predict, Verizon won’t be able to offset those costs, he said. “That's just not going to be possible.”
“In periods of heightened uncertainty,” Verizon “has demonstrated remarkable strength, given the importance and the essential nature of our connectivity services, the size and quality of our customer base and the strength of our balance sheet,” Vestberg said. Verizon said in a news release that its financial guidance for 2025 doesn’t “reflect any assumptions regarding the potential impacts of the evolving tariff environment.”
MoffettNathanson’s Craig Moffett said Tuesday that Trump's immigration policies and “much reduced net immigration” could create “headwinds” for the big three wireless operators as they seek to add customers to their subscriber rolls. Moffett said Verizon’s net loss of postpaid subscribers speaks to problems faced by the broader wireless industry.
“Verizon’s weakness appears to have begun at about the time that AT&T tweaked, er, raised, its promos,” Moffett said: “When AT&T's gain is Verizon's pain, well, that's the very definition of a zero-sum market. The growth problem here ... isn’t Verizon’s but is instead the wireless industry’s writ large.”
Vestberg said Verizon’s postpaid numbers improved in the latter stages of the quarter, and the company “started to see mid-single-digit growth in gross adds in March” and even better numbers this month. “We like our playbook,” he said: “It's an aggressive playbook, but it's also a playbook that lets us win.”
While postpaid subscribers were down, prepaid net adds of 137,000 were the best since the TracFone acquisition, Verizon said. The carrier reported total operating revenue of $33.5 billion in Q1, up 1.5% year over year, with wireless revenue of $20.8 billion, up 2.7%. Consolidated net income was $5 billion, compared with $4.7 billion a year ago. Wireless retail postpaid phone churn was 0.9%.
Verizon had net broadband additions of 339,000, driven by fixed wireless access net adds of 308,000, growing its base to more than 4.8 million of those customers.