Does SpaceX’s $8 Billion Spectrum Deal Mean Verizon’s Q3 Earnings Don’t Really Matter?
SpaceX just locked up $8 billion worth of 800 MHz spectrum, and Verizon reports earnings days later with a turnaround story that now faces a hard deadline before a well-funded rival shows up.
Verizon (NYSE:VZ | VZ Price Prediction) reports third-quarter results on October 26, days after SpaceX (NASDAQ:SPCX) announced a roughly $8 billion deal for nationwide 800 MHz spectrum. I think the deal makes this report more important. It shows how much momentum Verizon carries into a harder fight.
A Turnaround Faces Its First Real Test
Last quarter, Verizon posted adjusted EPS of $1.30 against a $1.27 consensus, its sixth straight beat. Revenue slipped 0.7% to $34.25 billion as equipment revenue fell nearly 20%, a deliberate pullback on subsidies. The core business strengthened: 184,000 postpaid phone net adds, churn down to 0.92%, and a record 40.1% adjusted EBITDA margin.
Management raised full-year adjusted EPS guidance to $4.99 to $5.04 and lifted the buyback target to up to $4.5 billion. Shares are up 16.94% year to date but down 4.89% over the past month. SpaceX’s spectrum announcement put Verizon, AT&T (NYSE:T), and T-Mobile (NASDAQ:TMUS) among the top decliners in the S&P 500 the day it landed.
Consensus Calls for Steady Growth
| Metric | Consensus | Prior Year | YoY Growth |
|---|---|---|---|
| Q3 2026 EPS | $1.2743 | $1.21 | 5.31% |
| Q3 2026 Revenue | $34.85 billion | $33.82 billion | 3.05% |
| FY 2026 EPS | $5.0179 | $4.71 | 6.54% |
| FY 2026 Revenue | $140.80 billion | $138.19 billion | 1.89% |
The Q3 EPS consensus has moved lower from $1.2925 90 days ago.
Service Revenue and Churn Will Answer the Starlink Question
Management guided mobility and broadband service revenue growth to approach 3% in Q3 and reach approximately 4% in Q4. I’ll be watching that number first. Hitting it would show the subsidy-light Simplicity and Verizon One strategy can grow revenue while maintaining price.
Churn comes next. Consumer postpaid phone churn fell to 84 basis points, which management called “a step change for Verizon.” For comparison, Q3 2025 delivered just 36,000 postpaid net adds with churn of 0.98%. You should look at whether retention holds now that a deep-pocketed entrant has a credible path into U.S. mobile.
The spectrum deal should close in the first half of 2027, and SpaceX plans to turn on service in early 2028. SpaceX said the spectrum could make Starlink Mobile “a major mobile carrier in the U.S.” In July, Verizon estimated satellite’s U.S. addressable market at 6 million to 8 million homes, mostly rural. I want to hear whether that framing changes now that SpaceX holds low-band spectrum built for indoor coverage.
Finally, AI Connect. The Google (NASDAQ:GOOGL) dark fiber agreement is valued at over $1 billion, and management flagged more deals by year-end.
Verizon Needs Proof Before Starlink Arrives
SpaceX’s threat is real, yet it sits more than a year away. That makes this report Verizon’s chance to show that lower churn, combined bundles, and Frontier’s fiber build a moat before a new carrier shows up. If service revenue speeds up and churn holds, Verizon heads into 2027 with its pricing power intact. If either slips, the market will treat it as early erosion, and the Starlink story will start to drive the stock.
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After two decades of patrolling the dark corners of suburbia as a police officer, Rich Duprey hung up his badge and gun to begin writing full time about stocks and investing. For the past 20 years, he’s been cruising the markets looking for companies to lock up as long-term holdings in a portfolio while writing extensively on the broad sectors of consumer goods, technology, and industrials. Because his experience isn’t from the typical financial analyst track, Rich is able to break down complex topics into understandable and useful action points for the average investor. His writings have appeared on The Motley Fool, InvestorPlace, Yahoo! Finance, Money Morning, and, of course, 24/7 Wall St. He has been featured in both U.S. and international publications, including MarketWatch, Financial Times, Forbes, Fast Company, and USA Today.
