By Harshita Mary Varghese

(Reuters) – Verizon Communications reported its best quarterly wireless subscriber growth in five years, driven by high demand for its customizable myPlan, Black Friday deals, and trade-in offers for the AI-powered iPhone 16 series.

This strong growth led to a 1% increase in shares, allowing investors to overlook annual profit and free cash flow forecasts below Wall Street expectations.

Verizon (NYSE:VZ) has invested billions into the C-band spectrum, known for its balance of speed and range, to enhance its 5G offering and surpass rivals AT&T (NYSE:T) and T-Mobile.

This investment is crucial for achieving Verizon’s target of acquiring up to 9 million subscribers for its fixed wireless service by 2028.

Additionally, Verizon introduced Verizon AI Connect, a suite of products and solutions for businesses to manage AI workloads at scale, aiming to leverage the rise of this technology.

The company projects that its adjusted profit for 2025 will grow between 0% and 3%, with the midpoint forecasting below analysts’ expectations of 2.7%, according to LSEG data.

Free cash flow is anticipated to be between $17.5 billion and $18.5 billion this year, slightly under the expected $18.44 billion, as per Visible Alpha.

In October, Verizon estimated capital spending for 2025 would range from $17.5 billion to $18.5 billion, up from $17.1 billion in 2024.

In Q4, Verizon added 568,000 monthly bill-paying wireless subscribers, surpassing FactSet estimates of 487,500. The company benefitted from price increases enacted in 2024 and the popularity of myPlan, which includes streaming perks like Disney+, Hulu, and Max for an additional cost.

“The wireless market is highly competitive, and Verizon has recently increased handset promotional activity and simplified pricing to attract and retain consumer subscribers,” said Dave Heger, communications services analyst at Edward Jones.

More than half of Verizon’s mobile customer base is subscribed to myPlan.

Wireless equipment revenue grew about 1% to $7.5 billion in the fourth quarter, driven by higher device upgrade volumes. Overall revenue amounted to $35.7 billion, slightly exceeding estimates of $35.32 billion.