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As of December 31, 2013

Verizon Communications Inc.

Table of Contents
Condensed Consolidated Statements of Income Non-Operational & Other Items Condensed Consolidated Balance Sheets Verizon – Selected Financial and Operating Statistics Condensed Consolidated Statements of Cash Flows Wireless – Selected Financial Results Wireless – Selected Operating Statistics Wireline – Selected Financial Results Wireline – Selected Operating Statistics Non-GAAP Reconciliations and Notes 3 5 7 7 9 12 13 15 16 18

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Condensed Consolidated Statements of Income (dollars in millions. except per share amounts) Unaudited 2011 $ 110.827) 10. net Interest expense Income Before (Provision) Benefit for Income Taxes (Provision) Benefit for income taxes Net Income Net income attributable to noncontrolling interests Net income attributable to Verizon Net Income Basic Earnings per Common Share Net income attributable to Verizon Weighted average number of common shares (in millions) Diluted Earnings per Common Share (1) Net income attributable to Verizon Weighted average number of common shares-assuming dilution (in millions) 45.275 39. where appropriate.846 $ 2013 120.Verizon Communications Inc. general & administrative expense Depreciation and amortization expense Total Operating Expenses Operating Income Equity in earnings of unconsolidated businesses Other income and (expense).874 Notes: (1) Diluted Earnings per Common Share includes the dilutive effect of shares issuable under our stock-based compensation plans.606 88.968 142 (166) (2.794 2.875 $ 2012 115.31 2.557 $ $ 44.557 $ 9.496 97.667) 29.887 27.547 $ $ $ $ .404 10.160 324 (1.875 35.866 $ .995 12.862 $ 4.833 $ .550 Operating Revenues Operating Expenses Cost of services and sales Selling.85 2.839 $ .089 16.951 16.880 444 (14) (2.198 $ $ 46. 3 .016) (2.00 2.571) 9. Certain reclassifications of prior period amounts have been made. to reflect comparable operating results.460 102.624 16.682 875 10.686 13.31 2.277 (5.582 31.01 2.897 660 10.497 23.547 12.198 $ 7.853 $ 4.85 2.730) 23.050 11.483 (285) 10.

183 19.128 22.849 $ .78 2.686 $ 3.065 Operating Revenues Operating Expenses Cost of services and sales Selling.319 7.59 Weighted average number of common shares-assuming dilution (in millions) 2.56 2.916 $ 2.279 11.68 2.593 $ 4.926) $ 4.923 (4.906 $ 2.346 2.926) $ 4. general & administrative expense Depreciation and amortization expense Total Operating Expenses Operating Income (Loss) Equity in earnings of unconsolidated businesses Other income and (expense).699 1.033 8.844) $ 3.916 $ .037 4.952 2.962 2.960 8.760 (726) (793) (631) 2.862 .034) (2.047 4.952 $ (1.857 4.991 8.78 2.866 $ .002 12.810 (864) (988) (1.64 2.069 16.028 23.719 6. 4 .896 7.047 5. diluted EPS is the same as basic EPS.578 $ 2. to reflect comparable operating results.855 $ 5.700 4.063 8 (250) (1.186 6.483 62 10 (632) 13. Certain reclassifications of prior period amounts have been made.56 2.901 5.866 $ (1.007 $ 30.68 2.48) $ 2.067 $ 7.849 5.154 23.872 $ .460 1.151 7.137 33.78 2.366 4.78 2.232 $ 5.214 (3.867 Diluted Earnings (Loss) per Common Share (1) Net income (Loss) attributable to Verizon $ .877 4.862 .061) 4.169) 87 (1.64 2.148 4.167 23.872 $ .555 120 25 (514) 10.855 $ 2.578 $ 7.632 5.865 $ .118 23.524 5.292 $ 2.198 6.906 $ 4.079) (575) 10.Verizon Communications Inc. net Interest expense Income (Loss) Before (Provision) Benefit for Income Taxes (Provision) Benefit for income taxes Net Income (Loss) Net income attributable to noncontrolling interests Net income (loss) attributable to Verizon Net Income (Loss) Basic Earnings (Loss) per Common Share Net income (Loss) attributable to Verizon Weighted average number of common shares (in millions) $ 29.875 Notes: (1) If there is a net loss.552 3Q 4Q $ 30.195 103 19 (685) 10.303 $ 2.128 19 20 (555) 11.285 $ 2.246 $ 5.903 (4.77 2.612 10.008 4.242 2012 2Q $ 28.874 $ 1.078 4.76 2.151 23.59 2.198 $ 5.849 $ .229) 1.222 (5) 39 (537) 11.285 $ 4.292 $ (1.786 3Q 4Q $ 31.858 $ . EPS may not add due to rounding.045 1Q $ 29.736) 5.825 $ 4. where appropriate.857 $ (1.651 72 34 (679) 10. except per share amounts) Unaudited 1Q $ 28.48) $ 2.842 $ .420 2013 2Q $ 29. Condensed Consolidated Statements of Income (dollars in millions.932 8. Diluted Earnings per Common Share includes the dilutive effect of shares issuable under our stock-based compensation plans.220 1.866 $ 1.198 $ 3.231 6.

net Wireless Transaction Costs Other income (expense). general & administrative expense Early Debt Redemption and Other Restructuring Costs Cost of services and sales Selling. Non-Operational & Other Items (Pre-tax dollars in millions) Unaudited 2011 $ 5. Pension & Benefit Charges/(Credits) Operating expenses Gain on Spectrum License Transactions Selling. net $ - $ - $ (278) $ - $ 384 $ - $ 120 $ 40 236 1.Verizon Communications Inc.097 $ - $ - $ - $ 927 5 . general & administrative expense Other income (expense).954 $ 2012 7.232) Severance.186 $ 2013 (6. general & administrative expense Litigation Settlements Selling.

general & administrative expense Litigation Settlements Selling.186 $ 1Q $ 2013 2Q (237) $ 3Q - 4Q $ (5. general & administrative expense Early Debt Redemption and Other Restructuring Costs Cost of services and sales Selling.Verizon Communications Inc. general & administrative expense Other income and (expense). Non-Operational & Other Items (Pre-tax dollars in millions) Unaudited 1Q $ 2012 2Q $ 3Q - 4Q $ 7. Pension & Benefit Charges/(Credits) Operating expenses $ Gain on Spectrum License Transactions Selling.097 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 62 $ 865 6 . net $ - $ - $ - $ - $ - $ - $ (278) $ - $ - $ - $ 384 $ - $ - $ - $ - $ - $ - $ - $ - $ 40 236 1. net Wireless Transaction Costs Other income and (expense).995) Severance.

357 5.956 3.938 85.192 88.834 193. to reflect comparable operating results.060 5.533 225.376 85.250 23.689 11.0x 2.223 30.933 4. 7 .461 $ 3.653 $ 297 37.990 (3.269 30.862 176.782 2.Verizon Communications Inc.878 5.591 40.957 25.139 5.682 28.3x 2.358 (3.575 120.900 1.987 $ 48.859 183.919 1.634 5.employee stock ownership plans and other Noncontrolling interests Total equity Total Liabilities and Equity $ 13.222 $ 297 37.235 209.461 $ 297 37.626 127.222 $ 53.939 215.063 1.642 3.734) 2.933 16.677 6.405 26.939 1.909 88. at cost Deferred compensation .406 70. property and equipment Less accumulated depreciation Investments in unconsolidated businesses Wireless licenses Goodwill Other intangible assets.975 $ $ 12/31/12 51.849 14.152 41.098 Verizon .092 $ 3.416 274.093 470 12.179 1.362 592 11.434 3.Selected Financial and Operating Statistics Unaudited 12/31/11 $ $ 55.400 2.098 $ $ $ $ 4.908 230.576 1.090 Total debt ($M) Net debt ($M) Net debt / Adjusted EBITDA Common shares outstanding end of period (M) Total employees Cash dividends declared per common share $ $ Certain reclassifications of prior period amounts have been made.535 274.269 (5.182 6.401 77.747 24.580 95.346 24.050 89.369 16.303 32.618 34.664 27.128 225.030 $ 12/31/13 93.075 4. net Other assets Total Assets Liabilities and Equity Current liabilities Debt maturing within one year Accounts payable and accrued liabilities Other Total current liabilities Long-term debt Employee benefit obligations Deferred income taxes Other liabilities Equity Common stock Contributed capital Reinvested earnings (Accumulated deficit) Accumulated other comprehensive income Common stock in treasury.961) 421 56.894 $ 1.155 230.639 5.453 6.528 601 12.776 940 4.448 73.432 75.761 50.235 (4. net Inventories Prepaid expenses and other Total current assets Plant.800 2.071) 440 52.658 27.021 21.790 2.956 47.800 4.744 24.439 1. where appropriate.020 3.865 131.933 88.002) 308 49. Condensed Consolidated Balance Sheets (dollars in millions) Unaudited 12/31/11 12/31/12 12/31/13 Assets Current assets Cash and cash equivalents Short-term investments Accounts receivable.994 220.472 $ 4.

983 52.926 37.400 $ .489 41.862 180.103 27. property and equipment Less accumulated depreciation Investments in unconsolidated businesses Wireless licenses Goodwill Other intangible assets.588 87.515 $ 231.186 3.645 24.515 2.849 188.376 54.423 76.894 $ 47.994) (3.726 5.732 4.995 129.658 27.994 2.185 87.901 88.063 1.479 31.862 178.830 4.835 25.921 $ 226.147 1.128 $ 225.181 3.346 24.530 2.859 183.957 $ 56.030 1.559 29.862 176.140 $ 93.500 2.428 92. Condensed Consolidated Balance Sheets (dollars in millions) Unaudited Assets Current assets Cash and cash equivalents Short-term investments Accounts receivable.200 $ .511 25.744 5.994 220.861 181.683 23.216 1.800 $ .465 5.791 33.421 90.591 $ 48.186 $ 223.258 $ 1.082 $ 225.093 470 12.254 $ 6.956 47.628 85.528 601 12.881 $ 49.987 $ 52.048 24.405 26.257 2.939 Reinvested earnings (Accumulated deficit) 1.539 73.130 217.500 2.474 5.822 $ 226.625 77.527 3.968 (3.001 $ 226.234 1.075 4.438) (4.841 191.186 215.235 2.303 23.390 9/30/12 $ 52.827 3.515 Certain reclassifications of prior period amounts have been made.675 $ 274.738 25.933 16.employee stock ownership plans and other 341 367 411 440 312 332 390 421 Noncontrolling interests 51.904 26.990 37.739 129. to reflect comparable operating results.675 $ 53.747 24.895 3.591 24.865 131.710 631 12.430 $ 40. net Other assets Total Assets Liabilities and Equity Current liabilities Debt maturing within one year Accounts payable and accrued liabilities Other Total current liabilities Long-term debt Employee benefit obligations Deferred income taxes Other liabilities 3/31/12 6/30/12 9/30/12 12/31/12 3/31/13 6/30/13 9/30/13 12/31/13 $ 5.191 41.595 856 3.468 26.512 $ 10.121 13.265 95.682 28.182 6.300 $ .346 $ 3.782 Accumulated other comprehensive income 1.892 88.888 14.088 12/31/12 3/31/13 6/30/13 9/30/13 12/31/13 $ 51.964 $ 42.223 4.909 88.768) 1.335 16.714 593 12.222 212.098 Verizon .255) (2.132 5.705 218.663 $ 3.653 Equity Common stock 297 297 297 297 297 297 297 297 Contributed capital 37.346 $ 276.193 3.533 87.3x 1.082 123.854 184.618 34.406 $ 47.821 5.139 5.156 90.001 777 11.597 $ 45.909 25.515 2.696 5.788 618 12.932 37.444 1.961 14.622 $ 3.295 21.664 27.118 2.770 46.Selected Financial and Operating Statistics Unaudited Total debt ($M) Net debt ($M) Net debt / Adjusted EBITDA Common shares outstanding end of period (M) Total employees Cash dividends declared per common share 3/31/12 $ 51.575 120.021 21.2x 1.278 53.639 5.610 5.845 1.894 37.634 5.622 6.030 6.339 5.839 $ 4.993 34.918 37.250 130.075 $ 7.961) Deferred compensation .064 88.478 5.933 4.571 31.1x 1.Verizon Communications Inc.072 $ 9.098 218.336 5.900 $ .688 6/30/12 $ 52.048 5.040 6.082 209.020 3.515 2.744 24.776 3.993 6.202 15.566 73.398 1.358 Common stock in treasury.467 30.956 3.912 13.336 129.802 $ 43.500 $ .072 $ 231.401 77.475 660 11.278 54.222 $ 226.432 75.580 Total Equity 88.353 46.321 75.895 37.561 22.467 30.483) (1.231 6.535 $ 274.750 53.503 24.649 5.164 25.2x 1.224 126.369 16.814 798 6.391 $ 42.446 $ 276.235 $ 5. 8 .677 6.003 6.332 3.970) (3.959 37.063 4.406 70.294 23.247) (4.913 48.071) (3. net Inventories Prepaid expenses and other Total current assets Plant.111 1.734) (3.154 $ 222.530 2.095 55.416 Total Liabilities and Equity $ 222.439 1.280 56. where appropriate.938 33.800 4.825 24.432 28.900 $ .476 32.453 6.319 75.677 $ 8.752 $ 99.844 87.809 88.974) (3.092 $ 10.810 3.901 27.642 3.337 $ 5.909 623 11.671 6.576 1.973 6.0x 2.800 $ .056 1.060 73.291 90.921 216. at cost (4.801 $ 223.050 89.933 88.735) (4.

785 993 (102) (5) (2.325) (4.362 $ 4.269) 13.060 (11.111 63 671 (14.555) 241 (1.547 Cash Flows From Operating Activities Net Income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization expense Employee retirement benefits Deferred income taxes Provision for uncollectible accounts Equity in earnings of unconsolidated businesses.250) (16.954) 38.093 $ 49.052) 5.936) 85 (153) (3.257) 26.230) 315 (8.163) (142) (5.403) (1. net Net cash used in investing activities Cash Flows From Financing Activities Proceeds from long-term borrowings Repayments of long-term borrowings and capital lease obligations Increase (decrease) in short-term obligations. beginning of period Cash and cash equivalents.606 (5.093 53.198 (952) 972 77 (403) (3.175) (913) (3. net of dividends received Changes in current assets and liabilities.166 (8.705) (5.528 9 .935) 27 494 (20.486 16. end of period 16.694 6. excluding current maturities Dividends paid Proceeds from sale of common stock Purchase of common stock for treasury Special distribution to noncontrolling interests Other.150) (5. net Net cash provided by (used in) financing activities Increase (decrease) in cash and cash equivalents Cash and cash equivalents.797) (221) 35 977 (17.423) 31.362 3.668 13.026 36 (2.662) (21.928 (5.437) (5.833) $ 11.450 50.780 16.557 $ 12 Months Ended 12/31/13 23.198 $ 12 Months Ended 12/31/12 10.426 (223) 1.836) 6.604) (494) (580) 2.244) (1.489 (6. net Net cash provided by operating activities Cash Flows From Investing Activities Capital expenditures (including capitalized software) Acquisitions of investments and businesses.900) 29.460 8. net of effects from acquisition/ disposition of businesses Other. Condensed Consolidated Statements of Cash Flows (dollars in millions) Unaudited 12 Months Ended 12/31/11 $ 10. net of cash acquired Acquisitions of wireless licenses Proceeds from dispositions of wireless licenses Net change in short-term investments Other.818 (16.502) (16.496 7.Verizon Communications Inc.435 3.279) (2.253) (10.805) 1.

437) Dividends paid (1.486 (1. net (453) (1.714 $ 3.126 1.150) (3.393) (2.269 354 1.531 (1.175) (913) (3.604) (494) (580) 2.403) Increase (decrease) in short-term obligations.909 $ 10.660) (2.450 50.547 4.191 $ 12.887) (5.812 507 (95) 12.602) (21) (117) 18 123 (3.150) (5.460 8.491) (1.483 $ 10.616) (76) (264) (21) 142 (7.291) (2.435 3.878) (6.584) (11.118 295 878 260 14 8.818 (3.472) 56 (153) (989) (1. net of cash acquired Acquisitions of wireless licenses Proceeds from dispositions of wireless licenses Net change in short-term investments Other.369) (4.453) (3.382 3.253) Increase (decrease) in cash and cash equivalents (7. end of period $ 5.648) (10.673) (7.257) 26.166 (2.136) (2.111 (11) 195 (10.835) (11.550) 2.528 10 .957 (1.580) (1.315) (838) (3. net Net cash used in investing activities 3 Months 6 Months 9 Months 12 Months 3 Months 6 Months 9 Months 12 Months Ended Ended Ended Ended Ended Ended Ended Ended 3/31/12 6/30/12 9/30/12 12/31/12 3/31/13 6/30/13 9/30/13 12/31/13 $ 3.599) (7.093 $ 500 (73) 581 (1.362 13.710 49.981) (21.423) 31.606 (5.489 Repayments of long-term borrowings and capital lease obligations (1.053 $ 15.150) (2.092) 17.954) 38.665 709 (197) 16.387 (5) (2.323 1.093 $ 1.587) (3.662) Net cash provided by (used in) financing activities (9.557 $ 4.398) 7.011 746 (100) 16.420) 76 (153) (3.253 53.500) (8.565) (140) (25) 16 41 (3. net of dividends received Changes in current assets and liabilities.237 521 (149) 12.198 (952) 972 77 4.758 (403) (3.361) (3.502) (3. Condensed Consolidated Statements of Cash Flows (dollars in millions) Unaudited Cash Flows From Operating Activities Net Income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization expense Employee retirement benefits Deferred income taxes Provision for uncollectible accounts Equity in earnings of unconsolidated businesses.425) (16.430) (203) (33) 21 61 (7.166 (8.093 5.906 $ 8.807) (81) (430) 2.093 $ 56.785 993 (102) (1. net of effects from acquisition/disposition of businesses Other.300) 15.617 3.271 (197) (3.028 375 656 278 (89) 8.734) (887) 375 (1.154) 24.078) (2.833) Cash Flows From Financing Activities Proceeds from long-term borrowings 4.362 13.052) 5.550) 35.618) (1.023) (16.891) (2.330) (432) (2.325) Other.423 649 3. excluding current maturities (1.305) 3.816) 28 516 (15.093 $ 53.269) Cash and cash equivalents.475 499 (2.001 $ 9.163) (142) (5.362 Cash and cash equivalents.788 49.156 751 1. net Net cash provided by operating activities Cash Flows From Investing Activities Capital expenditures (including capitalized software) Acquisitions of investments and businesses.230) Proceeds from sale of common stock 69 210 278 315 Purchase of common stock for treasury Special distribution to noncontrolling interests (4. beginning of period 13.362 13.946) 74 (153) (3.617) 5.148 (1.828) (1.855 $ 10.111 63 671 (14.936) 85 (153) (3.500) (4.631 $ 23.737) (11.500) (4.048) (12.Verizon Communications Inc.180) (10.935) 27 494 (20.392) (324) (4.895) 28.

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651 5.421 993 21. Certain reclassifications of prior period amounts have been made.538 616 16.203 5.217 $ 5.877 1.728 1.977 7.024 5.924 959 20.060 13.858 1.418 $ 6.896 $ 5.228 1.511 $ 8.037 12.768 1.523 (dollars in millions) 2013 2Q 3Q 4Q $ 16.424 $ 8.918 13.047 13.169 559 16.3% 49.154 1.006 13.690 5.125 $ 15.513 6.0% 32.516 1.012 19.332 5.056 5.261 2.8% 24.967 744 17.864 5.448 2.713 $ 6.785 $ 8.512 5. as the Company's chief operating decision maker excludes these items in assessing business unit performance.089 14.6% 30.4% 50.886 524 15.410 1.994 1Q $ 16. where appropriate.033 18.8% 29.135 $ 7.078 1.910 5.724 $ 8.318 46.399 $ 16.8% 51.5% $ 7.084 $ 6.393 2.791 $ 6.042 19.711 2.011 12.229 28.652 5.464 $ 6.8% 31.0% 41.838 1. Intersegment transactions have not been eliminated.4% 49.976 $ 16.546 6. 12 .813 982 19.025 18.9% 32. Wireless – Selected Financial Results Unaudited Operating Revenues Retail service Other service Service Equipment Other Total Operating Revenues Operating Expenses Cost of services and sales Selling.230 546 15.666 2.0% Footnotes: The segment financial results and metrics above are adjusted to exclude the effects of non-operational items.776 1.786 607 16. general & administrative expense Depreciation and amortization expense Total Operating Expenses Operating Income Operating Income Margin Segment EBITDA Segment EBITDA Service Margin 1Q $ 14.886 $ 6.946 $ 8.273 2012 2Q $ 15.Verizon Communications Inc.250 2.4% 33.422 656 17.994 15.801 2.577 3Q 4Q $ 15.295 2.0% 50.1% 47.776 740 17.953 945 19. to reflect comparable operating results.558 5.559 1.047 $ 4.799 5.105 5.

133 $ 2.95% 1.23% 0.569 $ 140. Wireless – Selected Operating Statistics Unaudited Connections ('000) Retail postpaid Retail prepaid Retail Net Add Detail ('000) (1) Retail postpaid Retail prepaid Retail Account Statistics Retail postpaid accounts ('000) Retail postpaid ARPA Retail postpaid connections per account Churn Detail Retail postpaid Retail Retail Postpaid Connection Statistics Total Smartphone postpaid % of phones activated Total Smartphone postpaid phone base Total Internet postpaid base Other Operating Statistics Capital expenditures ($M) 1Q 87.943 $ 150.01% 1. as the Company's chief operating decision maker excludes these items in assessing business unit performance.885 $ 2.530 5.70 34.763 2.2% 10.646 $ 143.535 228 1.8% 85.150 501 233 734 888 290 1.9% 70.965 101.930 2013 2Q 94.64 34.84% 1.354 5.316 94.8% 8.853 100.80 2.27 2.185 5.93% 1.32 2.21 2.2% 88.9% 67.242 677 43 720 941 97 1.72 35.76 0.1% 46.124 3Q 4Q 96.271 5.796 $ 145.230 1Q 93.3% 84.988 2012 2Q 88.752 6.18% 0.58 2.67 34.96% 1.2% 8.74 2.5% 77. 13 .744 98.4% 64.4% 9.992 $ 2.Verizon Communications Inc.9% 84. where appropriate.0% 10.6% 49.573 80 1.56 34.154 3Q 90.799 95.038 927 134 1.50 2.3% 61.545 95.057 $ 146.11% 0.450 $ 2.24% 0.186 5.7% $ 1.700 98.97% 1.28% 0.838 5.30% 0.4% 58.653 34.047 102.3% 71.7% 8.061 1. Certain reclassifications have been made.1% 9. to reflect comparable operating results.91% 1.972 $ 155.96% 1.791 $ 1.100 142 2.54 34. Intersegment transactions have not been eliminated.3% 53.24% 1.42 2.27% 71.278 $ 2.899 4Q 92.048 $ 2.025 92.60 35.4% 9.963 5. The segment financial results and metrics above are adjusted to exclude the effects of non-operational items.178 1.958 $ 152.6% 84.705 Footnotes: (1) Connection net additions exclude acquisitions and adjustments.083 $ 157.

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168 2.4% Footnotes: The segment financial results and metrics above are adjusted to exclude the effects of non-operational items.290 $ 2.483 2.796 642 4.873 5.914 5.814 $ 3.883 3.090 9. Intersegment transactions have not been eliminated.852 1.753 1.126 2.438 2.555 670 4.229 $ 2.103 1.085 9.6% 5. general & administrative expense Depreciation and amortization expense Total Operating Expenses Operating Income (Loss) Operating Income Margin Segment EBITDA Segment EBITDA Margin $ 1Q $ 3.781 1.7% 22.1% 21.646 1.407 2. to reflect comparable operating results.079 1. where appropriate.990 1Q $ 3.145 1. as the Company's chief operating decision maker excludes these items in assessing business unit performance.507 3.2% 22.643 648 4.669 118 9.770 145 9.Verizon Communications Inc.8% 5.743 188 $ 1.265 2.441 662 4.945 2012 2Q $ 3.139 1.660 74 $ 0.820 1.756 3. Certain reclassifications of prior period amounts have been made.108 $ 2.095 9.709 650 4.569 660 4.303 2.359 2.102 9.861 129 9.931 3Q 4Q $ 3.668 1.060 2.827 139 9.291 2.632 129 9.4% (3.102 2.799 $ 2.983 1.636 1.845 $ 3.463 2.074 9.727 110 9.090 1.572 2.1% 5.010 1.0% 21.148 $ 1.159 $ 2.830 (dollars in millions) 2013 2Q 3Q 4Q $ 3.557 3.457 2.225 2.846 1.107 9.771 3.500 2. 15 .837 3.087 1.3% 41 $ (326) $ 0.659 155 $ 1.7% 18.313 2.4% 22.478 667 4.247 $ 2.788 157 $ 1.714 131 1.6% 5.817 13 $ 0.3)% $ 2. Wireline – Selected Financial Results Unaudited Operating Revenues Consumer retail Small business Mass Markets Strategic services Core Global Enterprise Global Wholesale Other Total Operating Revenues Operating Expenses Cost of services and sales Selling.6% 23.073 9.589 651 4.553 3.229 2.115 1.782 126 9.9% 5.141 2.686 121 9.204 22.125 10.240 2.734 $ 3.666 3.969 1.878 2.316 5.581 2.

729 11.725 22.774 9.010 2.764 8.481 10.607 14.0% 13.6% 37.776 8.531 14.780 14.731 57.8 88.982 11.596 $ 1.Verizon Communications Inc.229 21.817 14.9% $ 103.4% 36.374 14.795 7.625 3.821 10.843 11.957 14.9 13. Intersegment transactions have not been eliminated.2% 39.2 84.278 3Q 4.191 2013 2Q 5.3% 34.06 $ 2.726 5.15 $ 2.484 $ 1.725 $ 1.424 3.965 58.995 6.368 36.298 11.377 3.515 $ 1.2% $ 105.1% 34.3% $ 107.7% $ 1.7% $ 117.384 11.015 6.5% Footnotes: The segment financial results and metrics above are adjusted to exclude the effects of non-operational items.124 11. to reflect comparable operating results.072 4.170 5.67 $ 2.762 90.371 8.282 8.943 15. Wireline – Selected Operating Statistics Unaudited Connections ('000) FiOS Video Subscribers FiOS Internet Subscribers FiOS Digital Voice residence connections FiOS Digital connections HSI Total Broadband connections Primary residence switched access connections Primary residence connections Total retail residence voice connections Total voice connections Net Add Detail ('000) FiOS Video Subscribers FiOS Internet Subscribers FiOS Digital Voice residence connections FiOS Digital connections HSI Total Broadband connections Primary residence switched access connections Primary residence connections Total retail residence voice connections Total voice connections Revenue & ARPU Statistics Consumer ARPU FiOS revenues ($M) Strategic services as a % of total Enterprise revenues Other Operating Statistics Capital expenditures ($M) Wireline employees (K) FiOS Video Open for Sale (K) FiOS Video penetration FiOS Internet Open for Sale (K) FiOS Internet penetration 1Q 4.489 53.4 86.5% 34.167 15.265 3.9% 35.824 15. where appropriate.2% 38.890 11.038 3.353 5.022 32.3% 32.488 8.049 8.085 180 193 414 787 (89) 104 (562) (148) (205) (437) 120 134 350 604 (132) 2 (501) (151) (199) (422) 119 136 290 545 (144) (8) (459) (169) (217) (431) 134 144 289 567 (117) 27 (402) (113) (156) (344) 169 188 304 661 (89) 99 (389) (85) (124) (312) 140 161 286 587 (116) 45 (393) (107) (142) (363) 135 173 252 560 (117) 56 (379) (127) (162) (371) 92 126 179 397 (106) 20 (340) (161) (192) (372) $ 97.166 8.457 4Q 5.661 3.847 4Q 4.473 5.6% 39.612 3.895 5.209 11.185 3.380 51.528 14.9% 33.26 $ 2.248 15.810 3.633 55.6% 32. 16 .6% $ 109.703 14.035 5.1% $ 100.537 $ 1.721 13.3% 38.262 6.7 83.88 $ 2.144 2.582 2.849 22.460 13.434 $ 1.344 11.503 1Q 4.4 85.283 14.421 23.583 21.518 $ 1.642 12.0% 37.200 11.227 13.648 12.894 7.491 12.005 22.6 87.86 $ 2.946 4.86 $ 2.943 9. Certain reclassifications have been made.828 3Q 5. as the Company's chief operating decision maker excludes these items in assessing business unit performance.565 54.700 2012 2Q 4.017 11.6 81.421 21.592 5.632 8.2% $ 112.593 11.938 12.200 14.63 $ 2.322 12.222 23.823 57.288 51.768 8.939 7.280 2.773 3.069 15.044 14.

As of December 31. 2013 .

Adjusted Operating Income is calculated by excluding the effect of non-operational items from the calculation of Consolidated Operating Income. equity in earnings of unconsolidated businesses and other income and (expense). 18 . Definitions – Non-GAAP Measures Non-GAAP Measures Verizon's financial information includes information prepared in conformity with generally accepted accounting principles (GAAP) as well as non-GAAP information.Wireline Segment EBITDA is calculated by adding back depreciation and amortization expense to Wireline Segment Operating Income. net to net income. Management believes that these measures provide additional relevant and useful information to investors and other users of our financial data in evaluating the effectiveness of our operations and underlying business trends in a manner that is consistent with management’s evaluation of business performance as they exclude the substantial impact of these events on the business. Consolidated Adjusted Operating Income Verizon Consolidated Adjusted Operating Income (Adjusted Operating Income) is a non-GAAP measure and does not purport to be an alternative to GAAP items as a measure of operating performance. Adjusted EPS is calculated by excluding the effect of nonoperational or non-recurring items from the calculation of reported EPS.Verizon Communications Inc.Consolidated EBITDA is calculated by adding back interest. as well as in evaluating operating performance in relation to Verizon's competitors. Wireless . Depreciation and Amortization (EBITDA). Consolidated Adjusted EBITDA is calculated by excluding the effect of non-operational items from the calculation of Consolidated EBITDA. EBITDA and EBITDA Margin Verizon Consolidated Earnings Before Interest. Segment EBITDA and EBITDA margins are non-GAAP measures and do not purport to be alternatives to GAAP items as measures of operating performance. Management believes that these measures are useful to investors and other users of our financial information in evaluating operating profitability on a more variable cost basis. and Wireless Segment EBITDA Service margin is calculated by dividing Wireless Segment EBITDA by Wireless service revenues. the financial statements prepared in accordance with GAAP. The non-GAAP financial information presented may be determined or calculated differently by other companies. The Wireless Segment EBITDA Service margin utilizes service revenues rather than Wireless' total operating revenues in order to capture the impact of providing service to the Wireless customer base on an ongoing basis. and Wireline Segment EBITDA margin is calculated by dividing Wireline Segment EBITDA by Wireline total operating revenues. Free Cash Flow Free Cash Flow is a non-GAAP financial measure that management believes is useful to investors and other users of our financial information in evaluating cash available to pay debt and dividends. Adjusted Earnings Per Common Share Adjusted Earnings Per Common Share (Adjusted EPS) and Adjusted Earnings Per Common Share excluding the impact of Superstorm Sandy are non-GAAP financial measures that management believes are useful to investors and other users of our financial information in evaluating our operating results and understanding our operating trends. It is management's intent to provide non-GAAP financial information to enhance the understanding of Verizon's GAAP consolidated financial information and it should be considered by the reader in addition to. Service revenues primarily exclude equipment revenues (as well as other non-service revenues). Consolidated . Management believes that Consolidated Adjusted EBITDA and Consolidated Adjusted EBITDA margin provide additional relevant and useful information to investors and other users of our financial data in evaluating the effectiveness of our operations and underlying business trends in a manner that is consistent with management’s evaluation of business performance. Wireline . depreciation and amortization expense. Adjusted Earnings Per Common Share excluding the impact of Superstorm Sandy is calculated by adding back the effect of Superstorm Sandy to the calculation of Adjusted EPS. but not instead of.Wireless Segment EBITDA is calculated by adding back depreciation and amortization expense to Wireless Segment Operating Income. Free Cash Flow is calculated by subtracting capital expenditures from net cash provided by operating activities. taxes. Consolidated EBITDA margin is calculated by dividing Consolidated EBITDA by Consolidated Operating Revenues. Taxes. as they exclude the depreciation and amortization expense related primarily to capital expenditures and acquisitions that occurred in prior years. Each non-GAAP financial measure is presented along with the corresponding GAAP measure so as not to imply that more emphasis should be placed on the non-GAAP measure. Management believes that this measure is useful to investors and other users of our financial information in evaluating the effectiveness of our operations and underlying business trends in a manner that is consistent with management’s evaluation of business performance. Consolidated Adjusted EBITDA margin is calculated by dividing Consolidated Adjusted EBITDA by Consolidated Operating Revenues.

Management believes that this presentation assists investors and other users of our financial information in understanding trends that are indicative of future operating results given the non-operational nature of the items excluded from the calculation. Adjusted EBITDA and Adjusted EPS Consolidated Adjusted Operating Income. as opposed to the actual discount rate and return on plan assets. Definitions – Non-GAAP Measures Net Debt and Net Debt to Adjusted EBITDA Ratio Net Debt and the Net Debt to Adjusted EBITDA Ratio are non-GAAP financial measures that management believes are useful to investors and other users of our financial information in evaluating Verizon's leverage. Consolidated Adjusted EBITDA and Adjusted EPS include pension expenses calculated based on the prior year-end discount rate and expected return on plan assets used during the first three quarters of the year. which are not available until December 31 or upon a remeasurement event. Net Debt is calculated by subtracting cash and cash equivalents from the sum of debt maturing within one year and long-term debt. Management believes that excluding actuarial gains or losses as a result of a remeasurement provides investors and other users of our financial information with more meaningful sequential and year-over-year quarterly comparisons and is consistent with management’s evaluation of business performance.Verizon Communications Inc. For purposes of the Net Debt to Adjusted EBITDA Ratio. Consolidated Adjusted Operating Income. 19 . Adjusted EBITDA is calculated for the last twelve months.

2 % 25.118 $ 10.034 555 (20) (19) 7.476 51.034 7.791 90.752 99.964 $ 42.065 $120.788 56.850 4.926) $ 4.223 5.222 6.658 49.195 4.128 4.004 (5.5)% 3.293 4.369 47.128 $ 9.167 $ 9.802 9.154 $ 11.140 93.251 33.061 250 (8) 12.894 1.912 46.938 89.183 $ 10.479 52.045 $115.391 10.088 $ 4.YTD (1) (1) Year-to-date Consolidated EBITDA and Consolidated Adjusted EBITDA represent the sum of the quarterly results.198 988 514 (25) (120) 6.063 1.2x $ 7.169) 6.555 7.430 28.578 1.706 $ 5.8% 52.597 5.550 (dollars in millions) Unaudited 3 Months 3 Months 3 Months Ended Ended Ended 3/31/12 6/30/12 9/30/12 3 Months 3 Months 3 Months Ended Ended Ended 12/31/12 3/31/13 6/30/13 3 Months 3 Months Ended Ended 9/30/13 12/31/13 Adjusted EBITDA .079 (87) (3.810) 575 1.063 $ 5.028 $ 9.151 $10.993 52.9% $ Consolidated Adjusted EBITDA Margin Consolidated Adjusted EBITDA Margin . (dollars in millions) Unaudited 3/31/12 6/30/12 9/30/12 12/31/12 3/31/13 6/30/13 9/30/13 12/31/13 Net Debt to Adjusted EBITDA Ratio Verizon Net Debt Debt maturing within one year Long-term debt Total Debt Less: Cash and cash equivalents Net Debt Net Debt to Adjusted EBITDA Ratio $ 3.202 $ 3.987 3.855 (2.779 384 5.651 4.068 4.223 $ 4.195 5.285 793 679 (34) (72) 5.222 4.430 $ 40.Verizon Verizon Consolidated EBITDA Consolidated net income (loss) Add/Subtract non-operating items: Provision (Benefit) for income taxes Interest expense Other (income) and expense. Consolidated Reconciliations (dollars in millions) Unaudited Consolidated Operating Revenues 3 Months 12 Months Ended Ended 12/31/12 12/31/12 $30.0% 34. net Equity in earnings of unconsolidated businesses Operating Income (Loss) Add: Depreciation and amortization expense Consolidated EBITDA Consolidated Operating Income Margin Consolidated EBITDA Margin Consolidated EBITDA Margin .Verizon Communications Inc.867 4.961 $ 8.246 38.137 968 (10.2x 1.195 4.3x $10.282 $ 7.186 276 4.167 $ 10.710 53.318 4.651 4.151 $10.1x 1. pension & benefit charges (credits) Gain on spectrum license transaction Litigation settlements Other non-operational costs Adjusted Operating Income Add: Depreciation and amortization expense Consolidated Adjusted EBITDA 5.995) 6.933 41.183 $ 16.555 4.1 % 32.618 51.028 $ 9.888 41.650 $ (1.093 $ 48.3 % 6.651 5.714 $ 43.222 4.335 46.137 8.483 4.3% 40.909 $ 45.YTD (1) Operating Income (Loss) Add/Subtract other items (before tax): Severance.0x 20 .118 $ 10.475 $47.001 $ 42.688 $ 5.406 1.3% 12.169) 4.340 (237) 6.591 1.779 $ 4.881 5.916 2.063 4.528 $47.469 (278) 6.844 1.128 $ 9.340 $ 5.390 $ 6.906 726 685 (19) (103) 5.6 % (3.121 48.483 $ 3.846 3 Months 12 Months Ended Ended 12/31/13 12/31/13 $ 31.467 52.292 631 632 (10) (62) 5.154 $ 11.128 864 537 (39) 5 6.

31 $ 0.55 0.175 $ 15.486 16.31 1.48) $ 1.76 (1.818 16.604 $ 22.66 $ 4.55 0.02) (0.31 0.Verizon Reported EPS Severance.77 $ 1. pension.78 (0.38 0.311 $ 38.08 2.84 2.07 2.24 0.01) 0. and benefit charges (credits) Gain on spectrum license transaction Wireless transactions costs Early debt redemption and other restructuring costs Litigation settlements Adjusted EPS Superstorm Sandy impact Adjusted EPS excluding Superstorm Sandy Impact Note: EPS may not add due to rounding.00 (1.77 0.31 0.29) 0.20 2.02) 0.Verizon Communications Inc.35) (0.Verizon Verizon Free Cash Flow Net cash provided by operating activities Less: Capital expenditures Free Cash Flow $ 31.45 0. Earnings Per Share Reconciliations Unaudited 3 Months 12 Months Ended Ended 12/31/12 12/31/12 3 Months 3 Months 12 Months Ended Ended Ended 9/30/13 12/31/13 12/31/13 Adjusted EPS .07 0.84 $ $ $ $ $ $ $ $ $ $ Free Cash Flow Reconciliations (dollars in millions) Unaudited 12 Months 12 Months Ended Ended 12/31/12 12/31/13 Free Cash Flow .214 21 . $ (1.66 0.19 0.

247 $ 2.084 $ 6.011 2.024 $ 19.273 $ 18. Wireless Reconciliations (dollars in millions) Unaudited 3 Months 3 Months 3 Months 3 Months 3 Months 3 Months 3 Months 3 Months Ended Ended Ended Ended Ended Ended Ended Ended 3/31/12 6/30/12 9/30/12 12/31/12 3/31/13 6/30/13 9/30/13 12/31/13 Wireless Segment EBITDA Operating Income Add: Depreciation and amortization expense Wireless Segment EBITDA Wireless total operating revenues Wireless service revenues Wireless Operating Income Margin Wireless Segment EBITDA Service Margin Wireless Segment EBITDA Service Margin -YTD (1) $ 5.318 $ 18.6% 1.095 2.785 $ 8.8% 1.0% 32.290 $ 2.125 $ 15.006 2.6% 1.511 $ 8.078 $ 17.090 2.159 $ 2.6% 49.814 $ 9.217 $ 5.8% 51.724 $ 8.148 $ 1.577 $ 19.1% 0.4% (3.399 $ 21.6% 30.074 2.204 $ 9.3% 22.4% 33.914 $ 9.102 2.418 $ 6.073 $ 2.1% 47.108 $ 2.918 2.410 $ 15.0% 50.060 2.8% 29.4% 22.229 1.931 $ 9.8% 24.994 2. Wireline Reconciliations (dollars in millions) Unaudited 3 Months 3 Months 3 Months 3 Months 3 Months 3 Months 3 Months 3 Months Ended Ended Ended Ended Ended Ended Ended Ended 3/31/12 6/30/12 9/30/12 12/31/12 3/31/13 6/30/13 9/30/13 12/31/13 Wireline Segment EBITDA Operating Income (Loss) Add: Depreciation and amortization expense Wireline Segment EBITDA Wireline total operating revenues Wireline Operating Income Margin Wireline Segment EBITDA Margin Wireline Segment EBITDA Margin -YTD (1) $ 157 $ 188 $ 41 $ (326) $ 13 $ 74 $ 155 $ 131 2.791 $ 6.464 $ 6.0% 46.154 $ 16.8% 31.229 $ 2.107 2.713 $ 6.2% (1) Year-to-date Wireline Segment EBITDA and Wireline Segment revenues represent the sum of the quarterly results.4% 50.089 $ 7.3% 49.2% 22.830 $ 9.7% 22.799 $ 2.4% 21.945 $ 9.7% 18.0% 41.9% 0.946 $ 8.047 2.085 2.5% 46.976 $ 20.3% 22.1% 21.037 1.6% 23.047 $ 4.728 $ 17.886 $ 6.4% 49.393 $ 16.3)% 0.424 $ 8.135 $ 7.523 $ 19.845 1.9% 32.990 $ 9. 22 .734 $ 9.516 $ 17.5% (1) Year-to-date Wireless Segment EBITDA and Wireless Segment Service revenues represent the sum of the quarterly results.125 2.776 $ 16.Verizon Communications Inc.994 $ 19.711 28.0% 21.