Verizon Added 406,000 Phone Customers and Signed a $2 Billion AI Deal — Yet Its Stock Fell

Verizon added 406,000 postpaid phone customers in the third quarter of 2026 — nearly double the roughly 209,000 analysts expected — raised its full-year guidance for the third straight quarter, and signed an AI infrastructure deal worth more than $2 billion with Amazon Web Services. Its shares still fell in Monday trading. That split reaction is why Verizon became one of the most talked-about stocks of the day.

What happened

Verizon reported third-quarter results on Monday, October 26, 2026. The headline number was subscriber growth: 406,000 postpaid phone net additions, up more than 820% from a year earlier and the company's strongest third-quarter phone performance in five years, according to its results release. It also added 137,000 postpaid accounts — its best quarterly account growth in more than a decade — and 314,000 broadband connections, taking total broadband connections to 17.4 million.

Adjusted earnings came in at $1.31 per share, up 8.3% year over year, ahead of the $1.27 forecast cited in market coverage. Net income rose 5.2% to $5.3 billion, adjusted EBITDA reached a company-record $13.8 billion, and free cash flow rose 12.1% to $7.8 billion.

The $2 billion AWS deal

The second headline was artificial intelligence infrastructure. Verizon signed an agreement valued at more than $2 billion with AWS under which it will provide high-capacity fiber-optic connectivity for AWS data centers, supporting distributed computing for generative and agentic AI workloads. On the earnings call, Chief Executive Dan Schulman said Verizon was also in talks with other hyperscalers, neocloud providers and large enterprise clients about supplying fiber connectivity — a sign the company wants its network, not just its phone plans, to be an AI business.

Schulman also addressed a potential new rival. Commenting on SpaceX's plans to enter the mobile market, he said building a competing terrestrial network would take four to six years and cost $300 billion to $500 billion, and that Verizon would be "ferociously competitive" once SpaceX enters.

Why the stock fell anyway

The miss was at the top line. Total operating revenue was $34.3 billion, up 1.5% year over year but short of the $34.74 billion analysts expected, according to LSEG data cited by Reuters. Equipment revenue fell 9.0% as customers kept their phones longer and Verizon cut device subsidies — a deliberate strategy the company says should continue to pressure device revenue in the fourth quarter, even as it lowers promotional costs. Promotional acquisition costs fell 41% year over year in the quarter.

Reuters reported Verizon shares fell 2.5% in early trading. In other words, investors focused on the revenue shortfall and the slower upgrade cycle rather than the subscriber beat — even though management argued the trade-off is intentional: fewer subsidies, lower churn, and higher-margin service revenue. Mobility and broadband service revenue grew 2.9% to about $23.5 billion, and postpaid phone churn improved to 0.94%.

Guidance raised — again

Verizon raised full-year 2026 guidance for the third consecutive quarter. It now expects 1.1 million to 1.2 million postpaid phone net additions this year, up from a previous range of 750,000 to 1 million, and adjusted earnings per share of $5.04 to $5.06, up from $4.99 to $5.04. It also lifted its outlook for operating cash flow and free cash flow growth, and said fiber passings should exceed 32 million by year-end.

What's next

The questions for the next quarter are concrete: can Verizon hit the top end of that 1.1 million to 1.2 million subscriber range, will service revenue accelerate toward the roughly 4% fourth-quarter growth it forecast, and will the AWS fiber work turn into more hyperscaler deals? Monday's reaction shows the market is not yet convinced the subscriber story outweighs soft equipment revenue — which is exactly why this earnings report, rather than a simple beat, is the one investors are arguing about.

Sources

Reuters via SRN News — Verizon lifts annual forecasts, signs more than $2 billion AI infrastructure deal with AWS
Verizon via GlobeNewswire — Third-quarter 2026 results
Grafa — Verizon Q3 revenue hits $34.3B, raises 2026 outlook

FAQ

How many customers did Verizon add in Q3 2026?

Verizon added 406,000 postpaid phone customers and 137,000 postpaid accounts in the third quarter, plus 314,000 broadband connections — its strongest third-quarter phone additions in five years.

What is Verizon's $2 billion AWS deal?

It is an agreement worth more than $2 billion under which Verizon will provide high-capacity fiber-optic connectivity for Amazon Web Services data centers, supporting generative and agentic AI workloads.

Why did Verizon's stock fall after the results?

Revenue of $34.3 billion missed the $34.74 billion analysts expected, as equipment revenue fell 9.0% on lower device upgrades and reduced subsidies, and Reuters reported the shares fell 2.5% in early trading despite the subscriber beat.

What guidance did Verizon raise?

Verizon raised its 2026 outlook for the third straight quarter, to 1.1 million–1.2 million postpaid phone additions and adjusted earnings per share of $5.04 to $5.06.