Verizon, one of the big three US phone carriers, has had a challenging 2025 as it continues to suffer from a worrying consumer trend that is affecting its business. Amid recent struggles, the company’s new CEO is doubling down on major changes to keep customers happy, reducing the risk of them switching to competitors.
In its latest earnings report, Verizon revealed that it added 616,000 new postpaid phone customers in the fourth quarter of 2025, the most new postpaid phone customers in six years.
However, the company saw its postpaid phone churn, the number of customers withdrawing service, hit 0.95%, which is 7 basis points higher than the churn rate it reported for the same quarter in 2024. The company’s operating income also fell 32.6% year-over-year.
The increased rate comes after Verizon made several bold price changes early last year that sparked customer backlash.
For example, last February, the company raised monthly rates for its myPlan and New Verizon Plan accounts by $3 to $5, citing “increasing operational costs.”
The following month, it raised the monthly price of its Verizon Mobile Protect Multi-Device plan and Verizon Mobile Secure Multi-Device plan by $8. By August, Verizon’s device activation fee had risen from $35 to $40, and the company announced it was discontinuing loyalty discounts.
Then in September, it raised its tablet plans by $5 to $10 and raised two key fees on customers’ monthly bills.
As customer backlash against these price increases grew and the churn rate continued to rise, Verizon named Dan Schulman CEO in October, replacing Hans Vestberg.
Shortly after stepping into the role, Schulman made it loud and clear during an earnings call that month that he was not a fan of the company’s price increases and vowed to “aggressively transform” the company to “build loyalty and make significant improvements in retention.”
He later laid off 13,000 employees to “simplify” the company’s operations and “better address the complexity and friction” that frustrates customers, according to an internal memo sent to workers.
As the churn rate continues to rise, Schulman is doubling down on the company’s transformation, arguing in a Jan. 30 earnings call that Verizon is “driving a customer-obsessed culture deep within the organization.”
“There’s no question that Verizon is at a critical inflection point, and there’s no question that we need to radically shift our culture toward the goal of delighting our customers and building a brand that represents trust so we can deliver for our shareholders,” Schulman said.
Verizon CFO Anthony Skiadas said on the call that the company’s postpaid rate increase in the fourth quarter was “largely from prior pricing actions as well as competition.”
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Schulman pointed out that over the past three years, Verizon’s loss rate in this segment has increased by 25 basis points, resulting in the loss of 2.25 million customers.
“There are four reasons people leave us,” Schulman said. “They’re price increases without corresponding value. That just irritates some customers and we’ve seen the result increase the churn rate, and we’ve stopped doing that and we’re going to start adding value.”
“The second is friction in the process, whether it’s integration, billing,” he continued. “When they call our customer service, that has to be seamless and we have to reduce complexity and we have to solve that. We already have initiatives underway to address each of those things. And then there’s price perception and the intensity of competition.”
Verizon has indeed faced increased competition from rival carriers such as AT&T and T-Mobile, which have ramped up their offerings and perks to attract new customers. Cable giants such as Comcast and Spectrum have also lured new phone customers with promotions on phone, Internet and TV service.
To keep customers away from rivals, Verizon is betting big on artificial intelligence to help eliminate customer pain points and simplify its offerings.
“We’re committed to being a company that gets AI, that implements AI at scale,” Schulman said. “We will use AI to optimize our operations and fundamentally reshape the customer experience. We use it to simplify offers, personalize interactions and reduce the churn rate through intelligent and consistent marketing. Using predictive models, we can anticipate customer pain points before they arise, allowing us to proactively solve problems.”
His comments come after Verizon began using AI last summer to improve its customer service. It also appears to be using AI to scan bills from rival phone operators to give customers personalized offers.
In addition to AI, Verizon is also relying on convergence opportunities, such as offering phone and Internet service offerings to customers, to reduce churn. That comes after Verizon completed its $20 billion acquisition of Frontier Communications last month, a move the carrier hopes will speed up the delivery of its wireless and Internet services to existing and new customers.
“First and foremost, and obviously crucial to our converged future, is the closing of our Frontier acquisition,” Schulman said. “We now have over 30 million fiber passes with a huge cross-sell opportunity as we are significantly under-penetrated with our wireless services in frontier markets.”
As Verizon doubles down on its turnaround plan, the company expects to gain between 750,000 and 1 million postpaid customers this year.
To achieve this goal and retain customers, Schulman stressed that the company must focus on rebuilding trust. However, this does not mean that customers will not see price increases in the future.
“The first thing is to stop doing things that customers hate,” Schulman said. “It’s not rocket science about it. Fix the end-to-end experience, again, not rocket science, but hard to do about it. And then you start to win back trust. And when you start to win back trust, you can start to put either promises or incremental value.
“I’m not saying we’re not doing price hikes, I’m saying we’re not going to do worthless price hikes,” he added. “But I think there are a lot of places where we can add value.”
Verizon’s increased focus on keeping its customers happy comes after it suffered a major service outage last month that left millions of customers in several states without phone service for about 10 hours, sparking widespread outrage.
So it’s vital for the company to focus on customer satisfaction, especially since a JD Power survey last year found Verizon trailing T-Mobile and MVNOs in postpaid phone plan satisfaction.
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The average consumer satisfaction score for postpaid plans within traditional carriers it is 593 (on a 1,000 point scale).
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T-Mobile ranks the tallest in the segment with a satisfaction score of 636.
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Verizon takes second place with a 583 Score.
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AT&T trails behind Verizon with a satisfaction score of 573.
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MVNO siteshowever, they have an average satisfaction score of 641.
Source: JD Power
“Findings show that value is the most important driver of overall experience, followed closely by service quality,” Carl Lepper, senior director of technology, media and telecommunications at JD Power, said in a press release.
After Verizon unveiled its latest earnings report, some analysts are signaling that its increased focus on growing customers may hurt its earnings going forward.
“Verizon’s Q4 (fourth quarter of 2025) results and guidance set the stage for Verizon to take a more aggressive stance on subscriber growth, which could come at the price of ARPU (average revenue per subscriber) dilution,” Citi analyst Michael Rollins said in a report viewed by Investor’s Business Daily.
“While Verizon also invests to delight customers and improve retention, Q4 results reveal subscriber growth with slower service revenue growth of 1.1% year-over-year,” he continued.
Another concern among analysts is the possibility that Verizon could start a price war with its competitors as it doubles down on attracting customers. In an analyst note, New Street Research analyst David Barden said Verizon is moving cautiously to prevent that.
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“As I’ve said in the past, Verizon has the best house in the neighborhood, and I know a price war is going to set this neighborhood on fire,” Barden said. “If they can capture about 200-300,000 postpaid phone networks each from AT&T and T-Mobile, it won’t hurt those companies significantly, while in our view it will meet Verizon’s short-term goal.”
Despite many analysts predicting Verizon’s future performance under Schulman, industry analyst Jeff Kagan said in a press release that the company’s latest earnings report does not reflect how it will grow over the next few years.
“It’s been quite some time since Verizon has shown strength, and investors are understandably anxious to see improvement,” Kagan said.
“We need to give (Schulman) the time and space to build momentum and get the ship moving in the right direction again,” he added.
Related: Verizon makes key policy changes to slow fleeing customers
This story was originally published by TheStreet on February 2, 2026, where it first appeared in the Retail section. Add TheStreet as a favorite source by clicking here.