Verizon signs AI infrastructure deal with AWS worth over $2 billion

Verizon said on Monday it has signed an AI infrastructure deal with Amazon Web Services worth more than $2 billion. Verizon described the AWS pact as setting up a commercial structure to support distributed computing for agentic and generative AI applications, according to its earnings release. Reuters reported that Verizon also lifted its yearly forecast for wireless subscriber additions, citing strong demand for its simplified plans.

The carrier added 406,000 postpaid phone net additions in the quarter, which Verizon said was its best Q3 result in five years and an increase of more than 820 percent from a year earlier. That was nearly double the 209,439 additions analysts had expected, according to Visible Alpha estimates cited by Reuters. Verizon shares rose 2.4 percent in premarket trading, Reuters reported.

Verizon CEO Dan Schulman said demand is strong across dark fiber, lit fiber and Edge compute locations. "Customer demand across dark fiber, lit fiber, [and] our Edge compute locations is exceptionally strong," Schulman said on the earnings call. He said additional hyperscalers, neocloud providers, and large enterprise clients are negotiating with Verizon for dark or lit fiber connectivity, and that initial multiyear agreements are projected to produce hundreds of millions of dollars in revenue over their life. Verizon has signed contracts totaling about $4 billion, he added.

Verizon previously signed a $1 billion fiber deal with Google, DatacenterDynamics reported. Under a multiyear agreement, Corning will provide Verizon with high-density optical fiber totaling over 80 million miles through 2032, supporting the carrier's long-haul backbone for AI hyperscalers.

Verizon reported third-quarter operating revenue of $34.3 billion, up 1.5 percent year over year. Mobility and broadband service revenue grew 2.9 percent, while equipment revenue declined 9 percent. Verizon gained 314,000 broadband customers on a net basis in the quarter: 159,000 came from fixed wireless access and 155,000 from fiber broadband, lifting total broadband connections to 17.4 million.

Verizon expects to reach 32 million fiber locations by the end of the year and remains on track for its medium-term target of 40 million to 50 million locations. The company lifted its full-year outlook for the third straight quarter, now expecting 1.1 million to 1.2 million postpaid phone net additions, up from a prior range of 750,000 to 1 million. Verizon also projected higher operating cash flow and free cash flow for the year. Schulman said the company would not sell fixed wireless access where it cannot deliver the speeds customers expect.