VZW Capex Levels Flat in the 3Q, Up for the Year

October 28, 2014

J. Sharpe Smith

October 28, 2014 — In the third quarter, wireless capex at Verizon Communications was $2.5 billion, even with last year’s third quarter, and through the first nine months of 2014 it totaled $7.8 billion, compared with $6.7 billion in 2013.

“Our deployment of capital in wireless has been very consistent throughout the first three quarters of this year,” said Fran Shammo, Verizon chief financial officer. “This year we had a much more flatness to our capex spending. So if you looked at prior year we always had more of a ramp into the back half of the year. You won’t see that this year; so it has become more level.”

Verizon has been deploying AWS spectrum across its footprint and currently has more than 400 markets with AWS, or XLTE, as it is branded.
“We are deploying capital to proactively stay ahead of demand, and our capital investments continue to focus on adding capacity to optimize our 4G LTE network, primarily by increasing network density and deploying spectrum,” Shammo said.

Along with the deployment of spectrum, Verizon is counting on investments in small cells, distributed antenna systems and in-building solutions allow it to build upon its current network.

“Our investment strategy is focused on adding capacity to our network to meet increasing demand, which is driven by 4G device adoption and higher customer usage,” Shammo said. “Growth in wireless revenue and profitability continues to be driven by our high-quality retail postpaid customer base, where we continue to see very strong 4G device adoption.”

In the next year, Verizon will focus on improving its capex-to-revenue ratio on a year-over-year basis.

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J. Sharpe Smith is the editor of AGL Link and Small Cell Link.