“With the strong year-to-date performance and our visibility into the second half, we now expect to grow our full year adjusted EPS by 6% to 7%.”

In context

“Anthony Skiadas : Thanks, Dan, and good morning. Our second quarter results reflect another strong quarter of execution, driving further momentum with our operational and financial performance. The transformation efforts we put in place are gaining traction as we continue to make progress around the customer experience while positioning ourselves to be even more efficient. As you heard from Dan, we are increasing our 2026 guidance for mobility and broadband service revenue, adjusted EPS and free cash flow. This marks the second quarter in a row of raising components of our original full year guidance. This was a direct result of strong operational execution and the progress we are seeing in the business. Let me begin with our operational results. In mobility, we delivered 184,000 postpaid phone net additions, an improvement of 193,000 from the prior year. This performance was driven by a 5 basis point year-over-year reduction in postpaid phone churn, reflecting the improvements we are making with the customer experience. As Dan mentioned, consumer postpaid phone churn was down 6 basis points year-over-year. This result led to consumer having positive postpaid phone net adds in the second quarter for the first time since 2021. Additionally, we had solid business phone net add results in the quarter, driven by year-over-year improvement across all customer groups. Overall, postpaid phone net adds were 239,000 for the first half of the year, an improvement of 537,000 from the same period last year. We are writing good business, and we continue to focus on growing volumes primarily by reducing churn. The key to reducing churn is becoming a customer-centric organization, and we are well on our way. In mid-June, we launched an industry-first loyalty program for all customers with Verizon Dollars and Verizon Shine. We also introduced our Simplicity and Verizon One offerings, which streamline our go-to-market approach. As Dan mentioned, the early results are very encouraging. We believe that the launch of Simplicity will be a key long-term driver for margin expansion. Further, the double-digit growth in app traffic since the launch is a concrete sign of interest in our programs and likely a leading indicator of churn improvement. The growing benefits we're seeing from churn reduction are allowing us to drive more of our net adds from retention, enabling lower spend on both COA and COR. We are being disciplined and targeted while also reducing churn with better segmentation. To that end, our second quarter upgrade volumes were down nearly 27% from the prior year. Moving on to prepaid. Our offerings continued their consistent volume growth and positive revenue contributions in the second quarter. Prepaid net adds were 73,000, our eighth consecutive quarter of positive net adds. As a result, prepaid revenue was up approximately $90 million year-over-year or nearly 5% growth. We continue to take share in broadband with 348,000 net additions in the quarter. Notably, we now have over 17.1 million total broadband subscribers in our base. Fixed wireless access and fiber delivered net adds of 193,000 and 155,000, respectively, demonstrating our continued success in capturing our broadband opportunity with both technologies. We continue to build out fiber at an aggressive pace and remain on track to end the year with over 32 million fiber passings. We like what we're seeing from the Frontier markets, both in terms of generating fiber net adds and our execution against a significant cross-sell opportunity. We recently launched Verizon One, which is our first unified go-to-market approach for mobility and broadband for both fiber and FWA. It is one of the many steps we are taking to improve the customer experience and make it easier to do business with us. Overall, our operational results for the first half of 2026 are a step function improvement in where Verizon has been over the past several years. We added over 1 million mobility plus broadband subscribers in the first 6 months of the year, positioning us well on the path to deliver long-term volume-based sustainable revenue growth. Moving to our financial results. The quality of the business we're writing and our cost efficiency efforts continue to drive strong adjusted EPS growth and industry-leading cash flows. We are accomplishing this even in the midst of our transitional year for mobility and broadband service revenue. As Dan mentioned, we drove an acceleration in our revenue growth rates compared to the prior quarter. Mobility and broadband service revenue was $23.4 billion, up 2.8% year-over-year and 120 basis points better sequentially. Wireless service revenue declined 0.7% from the prior year to $20.8 billion. Total revenue for the second quarter was $34.3 billion, down 0.7% year-over-year. Sequential improvement in mobility and broadband service revenue was offset by lower equipment revenue, which was down nearly 20% or over $1.2 billion from the prior year as we drove significantly lower upgrade volumes, another demonstration of our more disciplined approach as we structurally evolve our business model. The inflection in growth we saw in the second quarter, combined with our expectations for the rest of 2026, give us confidence in raising our mobility and broadband service revenue guide. We now expect to grow mobility and broadband service revenue 2.5% to 3% for the full year. In addition, we continue to anticipate wireless service revenue improving in the second half of the year. Importantly, we are confident that the headwinds from promo amortization have peaked and that these pressures will ease across the second half of the year and into 2027. Our cost efficiency work continues to drive operating leverage. As evident in our results, we're making tangible headway in our $5 billion operating cost efficiency program. We're also making great progress with the Frontier integration and remain on track to deliver over $1 billion in operating cost run rate synergies by 2028. Second quarter adjusted EBITDA was $13.7 billion, up 7.2% year-over-year. Adjusted EBITDA margin was 40.1% and represents the highest that we've ever reported. Adjusted EPS was $1.30, up 6.6% year-over-year. With the strong year-to-date performance and our visibility into the second half, we now expect to grow our full year adjusted EPS by 6% to 7%. Turning to cash flow. The high quality of our business and our customer relationships continue to generate strong free cash flow and support a healthy balance sheet. Cash flow from operations was $18.4 billion for the first 6 months of the year, up over $1.6 billion or nearly 10% higher year-over-year. This was primarily driven by improved adjusted EBITDA performance and continued working capital benefits primarily tied to lower upgrade volumes. Capital expenditures were $8.2 billion through the end of the second quarter. We are executing towards our full year guide of $16 billion to $16.5 billion as we continue to focus on future growth opportunities within mobility and broadband. The net of these resulted in industry-leading free cash flow of $10.2 billion for the first half of the year. This represents a $1.4 billion or a 16% improvement from the prior year. As Dan mentioned, the strength of our year-to-date results and the operational momentum of the business gives us confidence to increase our free cash flow guidance. We now expect to deliver 9% to 10% free cash flow growth year-over-year for 2026. The strength of our cash flow allows us to execute on all aspects of our capital allocation framework. Our first priority continues to be investing in the business. You saw us taking meaningful action to accomplish that in SEC Auction 113. We're very pleased to have obtained high-quality AWS-3 spectrum that will enhance our network experience in alignment with our commitment to our customers. In total, we acquired 82 licenses for approximately $3.2 billion, which is a slight discount to the original auction price from 2015. The licenses are complementary to our existing spectrum and can be deployed with no capital investment. This reflects our prudent approach to spectrum acquisition. We expect to have this additional spectrum deployed within weeks of the FCC issuing these licenses. We also continue to deploy fiber at scale to capture growth opportunities, including AI infrastructure builds across the country. As Dan said, we expect the amount of revenue associated with these deals to be in the billions over the next several years. AI infrastructure represents a large opportunity with a new long-term, high-quality revenue stream that we expect to ramp over the next few years. From a balance sheet perspective, we continue to pay down debt in the period. As of the end of the second quarter, we have paid off substantially all of Frontier's debt 6 months ahead of schedule. Our net unsecured debt to consolidated adjusted EBITDA ratio at the end of the quarter was 2.5x, a 0.1x improvement from the previous quarter. We remain on track to reach our target leverage range during the 2027 time frame. Lastly, year-to-date, we've delivered shareholder returns of $9.4 billion, up more than 60% year-over-year. This includes $5.9 billion of dividends and $3.5 billion of share repurchases. Our cash generation and the strength of our balance sheet provides significant optionality, which gives us the confidence to raise our full year 2026 target for share repurchases to up to $4.5 billion. In closing, our second quarter results represent a clear step function improvement across our entire business. Our transformation is taking hold, and we are actively translating operational momentum into sustainable, profitable growth. There are three key pillars to this. First, our operational momentum is very strong. We added over 1 million mobility and broadband subscribers in the first half of the year. This was driven by customer experience improvements and a 5 basis point year-over-year improvement in postpaid phone churn in the quarter. Second, disciplined financial execution. We generated our best ever reported adjusted EBITDA and adjusted EBITDA margin. This reflects our relentless focus on cost efficiencies and writing high-quality business as our operating expense savings program remains squarely on track. Third, we continue to evolve our offerings to be customer-centric. With the launch of Simplicity, Verizon One and our loyalty programs, we are successfully capturing new customers and retaining existing ones with robust economics. We are focused on putting the customer first, growing volumes responsibly and driving meaningful returns for our shareholders. We're executing on our transformation and delivering on our plan. We are playing to win. Before we go to Q&A, I want to share that our Board of Directors has extended Dan's contract through December 31, 2028. This reflects the Board's confidence in our trajectory, our strong results and the momentum of our ongoing transformation under Dan's leadership. The entire Verizon team is thrilled by this development, and we look forward to building the new Verizon. Congratulations, Dan, from all of us. More details are in the 8-K that we just released. With that, I will now hand the call over to Colleen to take your questions.”