Verizon Voluntary Severance, Other Cuts Cost $1.7 Billion in Q3

More than half of about 4,800 Verizon employees taking voluntary severance have already left the company.

The telecommunications provider has "implemented cost efficiencies" amid a streak of M&A activity. A little more than a month after Verizon announced it was buying wireline provider Frontier Communications, the carrier announced plans to buy $1 billion of spectrum assets from UScellular. As Verizon makes those respective investments in its fiber and mobility portfolios, the company has named "cost transformation" a key focus going into 2025.

Verizon Voluntary Severance Taking Effect

Severance charges tallied $1.7 billion in Q3 for Verizon. That number comes from both Verizon's previously announced voluntary severance offer as well as "other headcount reduction initiatives."

Verizon in June offered a voluntary separation program to certain U.S. based management team members. The firm said these voluntary departures would account for the principal severance charges in the third quarter, which ended Sept. 30.

Verizon on Sept. 1 provided a WARN Notice to the State of New Jersey that it will be shedding 50 employees from its Basking Ridge office on Dec. 1.

Verizon in its quarterly report Tuesday said its current number of employees is 101,200, compared to 105,400 a year prior.

Related:Verizon Announces $20 Billion Frontier Acquisition

The firm has also signed a deal with Vertical Bridge REIT for Vertical Bridge to lease and manage 6,339 cell towers from Verizon subsidiaries. That agreement will send $3.3 billion to Verizon with $2.8 billion upfront after its closes sometime by the end of 2042.

Verizon Revenue

Total operating revenues for Verizon in Q3 2024 stayed almost the same as a year prior at $33.3 billion. However, operating expenses ticked up from $25.9 billion to $27.4 billion. On the business side, operating revenues declined 2.3% to $7.4 billion. Verizon's business markets segment, which contains the midmarket and SMB, grew 2.5% to $3.3 billion. Enterprise and public sector fell 6.6% to $3.5 billion. Business Fios fiber internet connections grew 3.7% to 397,000, while wireline broadband connections remained almost unchanged at 459,000. Fixed wireless access (FWA) broadband business connections grew 63.6%, up to 1.7 million.

AT&T Earnings

Verizon's rival AT&T on Wednesday posted Q3 operating revenues of $30.2 billion, down from $30.4 billion a year prior. Operating expenses jumped from $24.6 billion to $28 billion. AT&T pointed primarily to a $4.4 billion non-cash goodwill impairment for its business wireline unit.

Demand for legacy business wireline services declined faster than expected, according to AT&T, leading Ma Bell to see an 11.8% decrease in revenue for business wireline to $4.6 billion. AT&T also pointed to the spin-off of managed security division LevelBlue.

Related:Verizon-Frontier Acquisition: Partners, Analysts Mixed on Reaction