U.S. carrier Verizon Communications Inc. signed a $1 billion (about 1.46 trillion won) data center consolidation contract with Google. The company said it expects to announce additional AI infrastructure contracts worth several billion dollars within the year.
Dan Schulman, Verizon Communications Inc. chief executive officer (CEO), said on the 24th (local time) during the second-quarter earnings conference call, "We signed a contract to provide dark fiber consolidation services to Google data centers," and added, "We expect to announce additional contracts worth several billion dollars within the year, securing a long-term revenue base." He added, "The core consolidation business is back on a growth track, and revenue tied to AI infrastructure has begun to take hold as a new growth driver."
Under CEO Schulman, who took office after last year's weak results, the legacy telecom business also showed signs of recovery. Verizon Communications Inc., helped by simpler rate plans and a stronger customer loyalty program, posted a net increase of 184,000 postpaid mobile subscribers in the second quarter, the largest gain in the past five years. Total net additions combining mobile and high-speed internet reached 550,000, up 230,000 from the same period a year earlier.
CEO Schulman said, "We proved with results that the rate plan overhaul is becoming a structural turning point for the company," and noted, "Churn is declining, and both new customer acquisition and retention expense are falling together."
Verizon Communications Inc.'s second-quarter revenue was $34.4 billion, holding roughly steady from a year earlier. Mobile and high-speed internet service revenue rose 2.8% year over year to $23.4 billion, but equipment revenue fell about 20% amid softer smartphone replacement demand.