Verizon Communications Inc. recently announced its intention to reduce capital spending by 23% in 2024 after the completion of its major 5G network buildout, aiming for the lowest capital intensity in the world relative to revenue. The company spent an estimated $22 billion on network upgrades last year as it sought to catch up with T-Mobile US Inc., and will project 2023 spending later this month when it releases its year-end results.
According to CEO Hans Vestberg, Verizon closed out 2022 with a net gain in customers, and their top priorities this year are generating more cash and increasing average revenue per user while lowering costs through sales of wireless home internet service. To achieve these goals, Verizon is looking to provide better access to high speed internet service in rural areas as well as provide more competitive pricing structures for new customers.
The company’s focus on reducing capital expenditure while also expanding their offerings looks set to bring them greater success. With Verizon already leading the way in terms of 5G coverage across the US, the expected reduction in spending should help them reach even higher levels of customer satisfaction and continue their impressive growth over the coming years.