Don’t expect Verizon to dramatically
increase its capital expenditures this year based on the benefits from
the tax reform legislation.
Verizon previously signaled its 2018
capex would likely be consistent with the past several years. It’s
pegged at about $17 billion. Company Chairman and CEO Lowell McAdam told
analysts on the Q4 2017 earnings call Tuesday, “Verizon has long supported corporate tax reform. We’re
very pleased to see this legislation passed.” Tax-reform legislation
will have a positive impact on cash flow from operations in 2018, of
approximately $3.5 billion to $4 billion.
“We’re only 30 days into the tax
reform process. We’re really trying to understand the implications and
what we can accelerate. 5G is influencing where we put our capital
dollars. I expect to see things pick up.”
Verizon is using available funding to
beef-up its network and look to the future with its 5G trials. The
company has said it intends to commercially launch 5G in three to five
cities this year, beginning with Sacramento. “Verizon has the spectrum
bandwidth needed to provide true services of 5G and the engineering
knowledge to provide a full suite of 5G services,” said McAdam. Continue Reading
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