MW Verizon and AT&T are seeing stock drops. Here's what's driving the selloff.

By Emily Bary

Verizon calls out a more competitive wireless industry, and that's weighing on its shares, as well as those of its peers

Verizon Communications Inc. sees a more competitive wireless environment this quarter, and that's weighing on its stock on Tuesday.

Shares of Verizon $(VZ)$ are off more than 7% in morning action after its chief revenue officer acknowledged "a challenging quarter from a competitive intensity standpoint" at a Deutsche Bank investor conference, according to a FactSet transcript. That generally refers to moves made by industry players to win new business or retain customers.

AT&T Inc.'s stock $(T)$ is down about 3%, as is T-Mobile US Inc.'s $(TMUS)$ stock.

Frank Boulben, Verizon's CRO, warned that the company faces tough comparisons this quarter relative to a year earlier. That creates the backdrop for "soft" gross additions, he added.

Verizon customers continue to hold onto their phones for a long time, according to Boulben, who said people now keep their devices for more than 41 months on average.

Far more Verizon customers are exiting financing contracts this year than was the case last year, but people tend to upgrade "progressively, not all at once as they get out of contract," Boulben said. As such, Verizon expects "a slow start in Q1 and then a progressive ramp up through the rest of the year."

Wireless stocks have held up better than the S&P 500 SPX this year, and the three big U.S. carriers eked out fractional stock gains on Monday in the face of the market rout. Verizon's stock was up about 16% on the year, through Monday's close, while AT&T's was ahead 20% and T-Mobile's was up 21%. The S&P 500, by contrast, was down more than 4%.

See more: AT&T's stock is on a historic tear. Here's why wireless names are hot this year.

By boosting wireless prices in recent years, the carriers have won favor with investors. Boulben said pricing moves in the last six or seven months contributed "more than a $1 billion of service revenue that's net of any churn caused by those prices," which is a "trade-off I would make any day."

AT&T also presented at Tuesday's Deutsche Bank conference. The company previously indicated softer trends in January, but Chief Financial Officer Pascal Desroches said this time around that "February was a really good month" and that he was "really pleased with how March has started."

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-Emily Bary

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March 11, 2025 09:58 ET (13:58 GMT)

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