New Verizon Global Services Org Will ‘Unlock’ New Opportunities In Private Wireless, MEC

The carrier giant also posted positive Business segment earnings led by growth in SMB, despite declines in the enterprise sector.

Verizon CEO Hans Vestberg

Telecom titan Verizon is leaning on its strength in core networking capabilities and has been taking actions to more efficiently run its business and focus on its wireless strategy.

One of those actions was the newly-formed Verizon Global Services (VGS) organization, revealed earlier in October, which will streamline shared services teams to free up more capital to the tune of $2 billion to $3 billion for the carrier to invest in its core networking and telecom services, according to Verizon CEO Hans Vestberg.

“This is one part of our larger program to leverage cross-functional opportunities across the business … [VGS] will help us unlock significant efficiencies and reduce costs across the business. We continue to practice financial discipline, even in a competitive market,” Vestberg said during the company’s third-quarter 2022 earnings call on Friday.

Craig Silliman, the carrier’s former chief administrative officer and general counsel, was named president of VGS.

[Related: Verizon Business Focuses On Co-Creation, Co-Selling By Teaming With Partners]

Vestberg called maintaining and growing the carrier’s momentum in fixed wireless access and business wireless priorities for Verizon moving forward.

The CEO also said Verizon continues to see high levels of interest from enterprises for private wireless and mobile edge computing (MEC), with strong demand for private 5G solutions. These services are built on top of the carrier’s “world-class” network, Vestberg said.

“There won’t be significant revenues in the short-term, but over time, we are building a totally new opportunities for Silliman and his team to be with customers in these larger, turnkey projects to transform their digital assets for enterprises,” he said.

The Basking Ridge, N.J.-based carrier’s Q3 2022 wasn’t quite where Verizon would like them to be, but Matt Ellis, Verizon’s executive vice president and CFO, said that the actions that Verizon has taken over the last two quarters are providing momentum. “We anticipate we will be able to build on this momentum as we head into the fourth quarter,” Ellis added.

Verizon Business reported 360,000 wireless retail postpaid net additions in third-quarter 2022, including 197,000 phone net additions. The results marked the fifth consecutive quarter that Business reported more than 150,000 postpaid phone net additions. The carrier’s Enterprise segment delivered its best ever phone net addition performance, and SMB and Public Sector both reported year over year double digit phone gross addition growth.

Total operating revenue for Verizon Business, which includes the company’s Global Enterprise Solutions, SMB, public sector and wholesale businesses, climbed 1.9 percent with revenue of $7.84 billion during the third quarter compared with $7.69 billion in the year-ago quarter.

Global Enterprise Solutions revenue, which has felt the brunt of the financial fallout from the pandemic, fell 4 percent to $2.50 billion in revenue in third-quarter 2022 compared with $2.55 billion a year ago.

SMB revenue, on the other hand, grew 8.8 percent during the quarter to $3.20 billion from $2.94 billion in the year-ago period. Public sector continued to decline, falling 1 percent to $1.53 billion during the quarter compared with $1.54 billion last year. Wholesale revenue grew by 1.2 percent to $661 million from $653 million during the third quarter of 2022.

Vestberg pointed to the task order with the U.S. Department of State that Verizon scored earlier this month to modernize U.S. embassies, consulars and other key locations around the globe in an Enterprise Infrastructure Solutions (EIS) contract valued at $1.58 billion over the next 10 years. “I’m proud that we’re the partner of choice for global enterprises and public sectors,” he said of the deal.

For the third quarter of the year, which ended September 30, 2022, Verizon reported operating revenue of $34.24 billion, up 4 percent from third-quarter 2021’s result of $32.92 billion. The carrier’s net income dipped 23.3 percent in the quarter to $5.02 billion compared with $6.55 billion during the same period last year. Verizon reported diluted earnings per share of $1.17 in third-quarter 2022, a 24.5 percent drop-off compared with $1.55 in third-quarter 2022.