Verizon Earnings Call to Address Starlink and Strategic Priorities

Verizon Communications reports third-quarter earnings Monday, with the earnings call scheduled for 8:30 a.m. ET. Wall Street forecasts adjusted earnings of $1.27 per share. Wall Street expects revenue of approximately $34.84 billion. A report days before the earnings release said Elon Musk's SpaceX is negotiating access to at least 80,000 U.S. cell sites for a nationwide mobile network. The news pushed Verizon and other major telecommunications stocks down Friday, renewing concerns about competition from Musk's Starlink.

Kalshi traders are betting on particular words that CEO Dan Schulman and Verizon's team will use during Monday's call. “Loyalty” has the highest probability, at 92%. Verizon introduced a loyalty program in June that offers customers 3% back and removes certain fees to discourage customers from changing carriers. Verizon's consumer phone churn declined to 0.84% last quarter from 0.90% the quarter before. The probability for “Headwind” is 86%. The probability for “Tailwind” is 64%. Those probabilities concern word usage rather than Verizon's financial prospects.

The probability for “Synergy” is 85%. Verizon completed the $20 billion purchase of Frontier Communications in January, substantially enlarging Verizon's fiber network and capacity to bundle mobile and home internet services. Verizon expects the combination to generate annual cost savings of at least $500 million by the third year. The probability for “AI Connect” is 84%. Verizon uses the AI Connect name for services supplying high-capacity fiber connections and other infrastructure to companies building and operating AI systems. Google signed an agreement worth more than $1 billion to link Google's data centers through Verizon's fiber network.

The probability for “Satellite” is 81%. The probability for “Spectrum” is 78%. Schulman argued in September that Starlink could not compete in urban and suburban areas without a terrestrial network. Those areas generate nearly all of Verizon's revenue. SpaceX has since agreed to purchase low-band spectrum, moving toward the infrastructure Schulman said Starlink lacked. The spectrum agreement triggered an 8.75% decline in Verizon shares on October 9, the largest one-day fall since 2002.

The probability for “Rural” is 50%. Schulman previously described rural areas as Starlink's natural market and argued that satellites supplement conventional networks rather than replace conventional networks. Verizon formally launched a satellite connectivity joint venture with AT&T and T-Mobile on October 1, after announcing the venture in May. The probability for “5G” is 44%. The probability for “C-Band,” an important part of Verizon's wireless spectrum holdings, is 28%.

Traders expect Schulman to focus on customer loyalty, acquisition benefits and Verizon's expanding AI infrastructure business. However, satellite competition also ranks among the more likely discussion topics. The Kalshi market does not list either “SpaceX” or “Starlink” as a word available for betting. Recent developments could bring Musk's mobile network ambitions into the discussion. A successful Starlink mobile network could eventually pressure prices and profit margins at America's three established wireless carriers.

Telecommunications analyst Roger Entner previously said SpaceX would likely expand a mobile network from rural America toward major cities rather than immediately compete in established carriers' strongest markets. Kalshi and Benzinga have a data collaboration agreement.