Common-Size Income Statement
Quarterly Data
Verizon Communications Inc., common-size consolidated income statement (quarterly data)
Based on: 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31).
The financial data reveals several notable trends across the reported periods in terms of revenue composition, cost structure, profitability, and expense management.
- Revenue Composition
- The contribution of service revenues and other to operating revenues predominantly fluctuates between approximately 78% and 87%, showing a tendency to decline slightly during certain quarters, especially around year-end reporting periods. Conversely, wireless equipment revenues demonstrate a complementary pattern, varying from about 12% up to above 21%, with peak values often aligning with quarters demonstrating dips in service revenues share. This suggests a dynamic interplay between these two revenue streams influencing total operating revenues.
- Cost Structure
- The costs related to services and wireless equipment combined consistently represent a substantial proportion of operating revenues, generally ranging from around 39% to 44%. There is a visible spike in cost percentages during some quarters, notably towards the end of 2022 and 2024, correlating with periods of increased wireless equipment revenue share. The separate costs of services and wireless equipment each indicate similar volatility with notable increases during some quarters, possibly reflecting changes in sales mix or cost pressures in supply chains.
- Profitability Metrics
- Gross profit margin relative to operating revenues remains relatively stable, typically oscillating between 55% and 62%, albeit with quarter-to-quarter variations. Operating income margin displays a broader range, with most quarters showing values between about 17% and 27%, except for an anomalous dip to approximately 1.7% during one quarter in late 2023, indicating a significant one-time impairment or extraordinary loss.
- Net income margins align with operating income trends, generally ranging from 10% to over 19%. A notable exception is observed in the same quarter with the operating income dip, where net income dropped sharply to negative values, reflecting the impact of the reporting of goodwill impairment in the Verizon Business Group during that period. Overall, the company maintains a positive profitability trajectory despite these occasional setbacks.
- Expense and Income Variations
- Selling, general and administrative expenses generally consume around 19% to 29% of operating revenues, with some quarters showing increased expense ratios, particularly in mid to late 2023 and beyond. Depreciation and amortization expenses remain comparatively stable, typically falling between 11% and 14%, indicating consistent capital asset usage and amortization policies.
- Interest expense as a proportion of operating revenues shows an increasing trend over time, rising from about 2.5% to above 5% in later periods, suggesting increased borrowing costs or debt levels. Other income (expense), net, presents volatile values across quarters, including spikes positive and negative, contributing episodically to income before taxes.
- Income Before Taxes and Tax Provisions
- Income before provision for income taxes mostly hovers between 18% and 25% of operating revenues, except for the problematic quarter with a negative figure caused predominantly by a substantial goodwill impairment. The provision for income taxes as a percentage of operating revenues similarly varies, generally ranging from about 2.5% to 5.5%, with lower proportions noted specifically in quarters following the impairment event, reflective of the decreased taxable income base.
- Equity in Earnings and Other Income
- Equity in earnings (losses) of unconsolidated businesses remains minimal throughout, fluctuating narrowly around zero. Other income (expense), net exhibits considerable variability, with occasional significant positive impacts, notably a sharp positive spike near the end of 2022, which boosts income before taxes temporarily.
In summary, the data depict a company with stable service revenue dominance complemented by variable equipment sales, balanced by closely managed costs that allow for steady gross and operating margins. However, occasional substantial impairments and fluctuating other income elements contribute to volatility in profitability. Interest expenses are on a rising path, warranting attention to debt management strategies. Overall, the financial performance is characterized by resilience amid episodic financial pressures.