Two of Apple’s biggest partners in the United States, Verizon and AT&T, announced their quarterly results this week. The earnings release comes amid economic concerns and ahead of the launch of the iPhone 14 in two months. For the second quarter, Verizon recorded a loss of 215,000 postpaid subscribers and AT&T recorded a gain of 813,000 net postpaid subscribers.
Verizon’s second quarter results
Verizon CEO Hans Vestberg explained that the carrier is currently facing several different headwinds, including inflation. Amid U.S. inflation concerns, Vestberg said customer additions have been hit as consumers seek to rein in spending.
In total, Verizon reported a loss of 215,000 postpaid phone subscribers and an additional 227,000 postpaid business subscriptions.
Recently announced price increases are also responsible for Verizon’s disappointing quarterly results. The company announced in June that it would begin charging an additional “economic adjustment fee” for many customers, a change that makes Verizon’s already expensive plans even more expensive.
Despite this, however, Reuters notes that Verizon has also warned that it may need to raise prices again if its costs continue to climb. Verizon is also looking to tap into the low end of the industry with its new Welcome Unlimited plan with 5G at $30 per month.
AT&T’s revenue
Meanwhile, AT&T reported stronger earnings in the second quarter of 2022. The carrier – the third largest in the United States – reported an increase of 813,000 net postpaid subscribers. These new subscribers are also switching to more expensive plans and devices, with AT&T saying revenue from its mobile unit rose 7.2% to $4.9 billion thanks to “increased sales of more expensive smartphones.” “.
AT&T COO Jeff McElfresh, however, said CBS that the carrier is seeing a slight increase in the number of customers deferring payment of their bills. “It’s not late payments, it’s just extended days of unpaid bills for a small amount,” he explained.
AT&T executives also touted it was six months ahead of its midband 5G rollout, a boost that will bring faster mobile data speeds to more than 100 million people by the end of the year.
What this means for the iPhone 14
Apple is likely watching earnings data from AT&T and Verizon closely as it prepares for the iPhone 14 launch this fall. AT&T’s earnings in particular show that consumers are still willing to shell out for high-end smartphones and data plans despite economic concerns.
Verizon’s numbers, however, are likely a concern for Apple given that it’s the largest carrier in the United States.
AT&T, Apple and Verizon have all relied heavily on funding and installment programs to drive smartphone sales in recent years. These programs allow customers to pay for new smartphones in equal installments over a period of up to 36 months. Carriers and Apple also rely on lucrative trade-in programs and promotions to entice buyers.
Apple is expected to release its quarterly results next week, July 28.
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