Three Point Six Seven Lines a FamilyNarrow moat

Verizon (VZ) — moat facet

Verizon's accounts carry 3.67 lines each, which locks families in but earns almost nothing extra per line.

The family plan is where Verizon's switching costs live. Retail postpaid connections per account rose from 3.61 at the end of 2024 to 3.67 at the end of 20251. A household with nearly four lines, perhaps a watch or a tablet among them, on one bill and one credit check, has four reasons to stay and one decision to make if it leaves.

Verizon service revenue per postpaid line ($ a month)46.33202446.492025Moat Explorer calc: postpaid ARPA over connections per account, Q4 2025 results release
More lines per account, the same money per line.

Verizon's key revenue measure is set at the account, not the phone. ARPA is "average service revenue per account from retail postpaid accounts"2. It was $167.26 in 2024 and $170.62 in 20253, up 2.0%4. Divided by lines, the average service revenue per connection moved from about $46.33 to about $46.495, essentially flat.

So the account grew by adding lines, and the lines did not get more expensive. That is the shape of a mature franchise: the growth comes from connecting more devices to the same family, often at a discount for the extra line, while the headline phone price stands still.

The account model has held against a lot. Accounts fell while lines rose, argued on Accounts Are Shrinking, and ARPA fell 1.4% in the June 2026 quarter6, argued on Revenue per Line Barely Moves.

The instalment plan reinforces the family plan. Customers owed $34,004 million in gross device payment receivables at the end of 20257, and a household with four lines, some still being paid off, faces four instalment balances if it wants to move. The 2026 drop in upgrades, argued on Fewer Upgrades, Less Equipment Revenue, loosens that part of the lock.

Lines per account can keep rising only so far. The warning would be connections per account going flat while ARPA falls: the family plan would have stopped carrying the revenue, and Verizon would need new households it has not been winning.

Moat trajectory: Holding steady

3.67 connections per account at end-2025, from 3.61.

The number that tests this moat
Reported
Retail postpaid connections per account, full year
3.67 (end-2025), from 3.61 at end-2024

The depth of the family plan; flat while ARPA falls would say the account has stopped carrying the growth.

Source: Verizon Q4 2025 results release ↗
⚠ Threats to the moat
⚠ THREAT 01
Revenue per Line Barely Moves
Verizon's service revenue per postpaid line was about $46.49 a month in 2025, 16 cents more than in 2024, so the franchise grew by adding lines, not…
References
  1. ReportedRetail postpaid connections per account rose from 3.61 at the end of 2024 to 3.67 at the end of 2025.
    Verizon fourth-quarter and full-year 2025 results release, Form 8-K exhibit 99 - full-year operating statistics, segment EBITDA, free cash flow 2020-2025 and 2026 guidance - operating statistics: connections, net additions, churn, ARPA, Fios and fixed wireless. — FY2025 · publ. 30 January 2026 · source ↗
  2. ReportedARPA is "average service revenue per account from retail postpaid accounts".
    Verizon second-quarter 2026 results release, Form 8-K exhibit 99 - consolidated and segment results, operating statistics, cash flow, balance sheet and guidance - operating statistics: connections, net additions, churn, ARPA, upgrades and broadband. — Q2 2026 · publ. 24 July 2026 · source ↗
  3. ReportedIt was $167.26 in 2024 and $170.62 in 2025, up 2.0%.
    Verizon fourth-quarter and full-year 2025 results release, Form 8-K exhibit 99 - full-year operating statistics, segment EBITDA, free cash flow 2020-2025 and 2026 guidance - income statement, segment EBITDA and highlights. — FY2025 · publ. 30 January 2026 · source ↗
  4. Moat Explorer calcIt was $167.26 in 2024 and $170.62 in 2025, up 2.0%.
    Moat Explorer calculation from Verizon's reported figures ($ millions unless stated; calendar years). Revenue and profit over the decade: revenue 2015-2025 (138,191 / 131,620) ^ (1/10) - 1 = about 0.5% a year; 138,191 / 131,620 - 1 = +5.0%; range 138,191 - 125,980 = about 12.2bn; 2027 revenue of 142bn would need (142 / 138.191) ^ (1/2) - 1 = about 1.4% a year; operating income 29,259 / 30,615 - 1 = -4.4%; net income 17,174 / 17,879 - 1 = -3.9%; diluted EPS 4.06 / 4.37 - 1 = -7.1%; total assets 404,258 / 244,175 - 1 = +65.6%. Segments 2025: Consumer share of segment operating income 29,628 / (29,628 + 2,532 = 32,160) = 92.1% (2024 29,484 / 31,542 = 93.5%; 2023 29,011 / 31,077 = 93.4%); Business share 2,532 / 32,160 = 7.9%; Q2 2026 Consumer 8,032 / (8,032 + 991 = 9,023) = 89.0%, Q2 2025 7,643 / (7,643 + 724 = 8,367) = 91.3%; Consumer operating margin 29,628 / 106,807 = 27.7%, Business 2,532 / 29,069 = 8.7%; Business share of segment revenue 29,069 / 135,876 = 21.4%; shared network and service costs 17,991 + 9,717 = 27,708, Business share 9,717 / 27,708 = 35.1%; Consumer share of segment EBITDA 43,801 / (43,801 + 6,644) = 86.8%; Consumer revenue 2025 106,807 / 102,904 - 1 = +3.8%, 2023-2025 106,807 / 101,626 - 1 = +5.1%; Consumer service revenue 80,617 / 77,127 - 1 = +4.5%; Consumer equipment 21,779 - 23,930 = -2,151, about 2.2bn below cost; Business revenue 29,069 / 30,122 - 1 = -3.5%; Enterprise and Public Sector 13,532 / 15,076 - 1 = -10.2%; Business Markets and Other 13,555 / 12,697 - 1 = +6.8%; Wholesale 1,953 / 2,313 - 1 = -15.6%; institutional and wholesale decline (15,076 - 13,532) + (2,313 - 1,953) = 1,904; Q2 2026 Consumer revenue 26,242 / 26,648 - 1 = -1.5%; Business revenue 7,155 / 6,973 - 1 = +2.6%; restatement 7,275 - 6,973 = 302 a quarter; mobility and broadband service revenue 2025 75,923 + 14,940 = 90,863. Customers: T-Mobile postpaid accounts 34,700 - 34,237 = 463 more than Verizon; T-Mobile 34,700 / 31,502 - 1 = +10.2%, 34,700 - 31,502 = 3,198; Verizon accounts 34,237 - 34,646 = -409, -1.2%; ARPA premium 168.35 / 152.91 - 1 = +10.1%; cable lines 10,187 + 12,540 = about 22.7 million; cable Q2 net adds 448 + 406 = 854 thousand, 854 / 184 = 4.6 times; Q2 net adds share 184 / (184 + 432 + 448 + 406 = 1,470) = 12.5%; fibre net adds 155 / 367 = 42%; annual churn at 0.92% a month 0.92 x 12 = 11.0%, about one customer in ten; 0.1 point on 94 million = about 94 thousand phones a month; prepaid churn 3.59 / 0.92 = 3.9 times; prepaid annual loss 1 - (1 - 0.0359) ^ 12 = 35.5%, average life 1 / 0.0359 = 27.9 months, a little over two years; revenue per postpaid line 170.62 / 3.67 = 46.49 (2025), 167.26 / 3.61 = 46.33 (2024); ARPA 2025 170.62 / 167.26 - 1 = +2.0%; ARPA Q2 2026 168.35 / 170.79 - 1 = -1.4%; ARPA H1 2026 167.50 / 170.30 - 1 = -1.6%; wireless service revenue 83,703 / 82,073 - 1 = +2.0%; wireless service share of revenue 83,703 / 138,191 = 60.6%; FWA revenue 2,940 / 2,139 - 1 = +37.4%; FWA revenue share 2,940 / 138,191 = 2.1%; fibre annualised 155 x 4 = 620 thousand; passings 2.0 / 30 = 6.7%; passings to fill 2,000 / 620 = 3.2 times. Spectrum and capital: C-Band 45.5 + 7.5 = 53.0bn; licences share of assets 158,159 / 410,186 = 38.6%; licences over goodwill 158,159 / 30,664 = 5.2 times; licences over equity 158,159 / 105,196 = 1.5 times; wireless service revenue per dollar of licences 83,703 / 157,039 = 0.53; spectrum bought June 2026 1.0 + 3.2 = 4.2bn; capex / revenue 17,011 / 138,191 = 12.3% (2025), 23,087 / 136,835 = 16.9% (2022); capex 17,011 / 23,087 - 1 = -26.3%; capex less depreciation 17,011 - 18,349 = -1,338; ROIC averages 2015-2019 (10.8 + 9.1 + 12.7 + 8.2 + 11.3) / 5 = 10.4%, 2021-2025 (8.7 + 7.3 + 5.0 + 7.0 + 7.1) / 5 = 7.0%; interest expense 6,694 / 5,524 - 1 = +21.2% (2023-2025); Q2 interest 1,985 / 1,639 - 1 = +21.1%; interest / operating income 6,694 / 29,259 = 22.9%. Cost, cash and capital returns: employees 89.9 / 99.6 - 1 = -9.7%; severance 533 + 1,733 + 1,715 + 397 = 4,378, about 4.4bn; adjusted EBITDA margin 49,997 / 138,191 = 36.2% (2025), 48,791 / 134,788 = 36.2% (2024); Q2 2026 operating income 7,179 / 8,172 - 1 = -12.2%; free cash flow Q2 6,426 / 5,167 - 1 = +24.4%; adjusted EPS less diluted EPS 4.71 - 4.06 = 0.65; phones sold below cost 28,976 - 25,470 = 3,506, about 3.5bn; dividends / free cash flow 11,481 / 20,126 = 57.0% (2025), 5,864 / 10,209 = 57.4% (H1 2026); dividends / net income 11,481 / 17,174 = 66.9%; dividends per share 2.735 / 2.230 - 1 = +22.6%, (2.735 / 2.230) ^ (1/10) - 1 = 2.1% a year; dividend cost a quarter 0.7075 x 4,155 = about 2,940; buyback average 3,500 / 72.047 = about $48.58 a share; shares 4,155 / 4,217 - 1 = -1.5%; free cash flow yield 21.53 / 193.94 = 11.1%; cash returned about (11.5 + 4.5) / 193.94 = 8.2% of market value; net unsecured debt 128,682 - 110,053 = 18,629; backlog 55.2 / 58.1 - 1 = -5.0%; backlog months 58.1 / 138.191 x 12 = about 5.0; device receivables 34,004 / 31,308 - 1 = +8.6%, allowance 1,628 / 1,315 - 1 = +23.8%; TracFone 3.5 + 3.0 = 6.5bn plus up to 0.65bn. Valuation: Frontier price / market value 22.3 / 193.94 = 11.5%; market value 193.94 / 253.94 - 1 = -23.6% (against end-2019), 193.94 / 188.06 - 1 = +3.1% (against end-2015); target 51.58 / 46.68 - 1 = +10.5%; year-end market value over net income 188.06 / 17.879 = 10.5 (2015), 217.61 / 13.127 = 16.6 (2016), 215.92 / 30.101 = 7.2 (2017), 232.30 / 15.528 = 15.0 (2018), 253.94 / 19.265 = 13.2 (2019), 243.11 / 17.801 = 13.7 (2020), 215.12 / 22.065 = 9.7 (2021), 165.47 / 21.256 = 7.8 (2022), 158.49 / 11.614 = 13.6 (2023), 168.34 / 17.506 = 9.6 (2024), 171.74 / 17.174 = 10.0 (2025); trailing twelve months to June 2026 revenue 138,191 - 67,989 + 68,693 = 138,895, net income 17,174 - 9,882 + 8,880 = 16,172, 193.94 / 16.172 = 12.0, 193.94 / 138.895 = 1.40 - revenue, profit, costs and growth over time. — 2015-2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Verizon's Forms 10-K and 10-Q, quarterly results releases, the recast segment revenue 8-K, peer results releases (T-Mobile, AT&T, Comcast, Charter) and market data; operands shown in the source line.
  5. Moat Explorer calcDivided by lines, the average service revenue per connection moved from about $46.33 to about $46.49, essentially flat.
    Moat Explorer calculation from Verizon's reported figures ($ millions unless stated; calendar years). Revenue and profit over the decade: revenue 2015-2025 (138,191 / 131,620) ^ (1/10) - 1 = about 0.5% a year; 138,191 / 131,620 - 1 = +5.0%; range 138,191 - 125,980 = about 12.2bn; 2027 revenue of 142bn would need (142 / 138.191) ^ (1/2) - 1 = about 1.4% a year; operating income 29,259 / 30,615 - 1 = -4.4%; net income 17,174 / 17,879 - 1 = -3.9%; diluted EPS 4.06 / 4.37 - 1 = -7.1%; total assets 404,258 / 244,175 - 1 = +65.6%. Segments 2025: Consumer share of segment operating income 29,628 / (29,628 + 2,532 = 32,160) = 92.1% (2024 29,484 / 31,542 = 93.5%; 2023 29,011 / 31,077 = 93.4%); Business share 2,532 / 32,160 = 7.9%; Q2 2026 Consumer 8,032 / (8,032 + 991 = 9,023) = 89.0%, Q2 2025 7,643 / (7,643 + 724 = 8,367) = 91.3%; Consumer operating margin 29,628 / 106,807 = 27.7%, Business 2,532 / 29,069 = 8.7%; Business share of segment revenue 29,069 / 135,876 = 21.4%; shared network and service costs 17,991 + 9,717 = 27,708, Business share 9,717 / 27,708 = 35.1%; Consumer share of segment EBITDA 43,801 / (43,801 + 6,644) = 86.8%; Consumer revenue 2025 106,807 / 102,904 - 1 = +3.8%, 2023-2025 106,807 / 101,626 - 1 = +5.1%; Consumer service revenue 80,617 / 77,127 - 1 = +4.5%; Consumer equipment 21,779 - 23,930 = -2,151, about 2.2bn below cost; Business revenue 29,069 / 30,122 - 1 = -3.5%; Enterprise and Public Sector 13,532 / 15,076 - 1 = -10.2%; Business Markets and Other 13,555 / 12,697 - 1 = +6.8%; Wholesale 1,953 / 2,313 - 1 = -15.6%; institutional and wholesale decline (15,076 - 13,532) + (2,313 - 1,953) = 1,904; Q2 2026 Consumer revenue 26,242 / 26,648 - 1 = -1.5%; Business revenue 7,155 / 6,973 - 1 = +2.6%; restatement 7,275 - 6,973 = 302 a quarter; mobility and broadband service revenue 2025 75,923 + 14,940 = 90,863. Customers: T-Mobile postpaid accounts 34,700 - 34,237 = 463 more than Verizon; T-Mobile 34,700 / 31,502 - 1 = +10.2%, 34,700 - 31,502 = 3,198; Verizon accounts 34,237 - 34,646 = -409, -1.2%; ARPA premium 168.35 / 152.91 - 1 = +10.1%; cable lines 10,187 + 12,540 = about 22.7 million; cable Q2 net adds 448 + 406 = 854 thousand, 854 / 184 = 4.6 times; Q2 net adds share 184 / (184 + 432 + 448 + 406 = 1,470) = 12.5%; fibre net adds 155 / 367 = 42%; annual churn at 0.92% a month 0.92 x 12 = 11.0%, about one customer in ten; 0.1 point on 94 million = about 94 thousand phones a month; prepaid churn 3.59 / 0.92 = 3.9 times; prepaid annual loss 1 - (1 - 0.0359) ^ 12 = 35.5%, average life 1 / 0.0359 = 27.9 months, a little over two years; revenue per postpaid line 170.62 / 3.67 = 46.49 (2025), 167.26 / 3.61 = 46.33 (2024); ARPA 2025 170.62 / 167.26 - 1 = +2.0%; ARPA Q2 2026 168.35 / 170.79 - 1 = -1.4%; ARPA H1 2026 167.50 / 170.30 - 1 = -1.6%; wireless service revenue 83,703 / 82,073 - 1 = +2.0%; wireless service share of revenue 83,703 / 138,191 = 60.6%; FWA revenue 2,940 / 2,139 - 1 = +37.4%; FWA revenue share 2,940 / 138,191 = 2.1%; fibre annualised 155 x 4 = 620 thousand; passings 2.0 / 30 = 6.7%; passings to fill 2,000 / 620 = 3.2 times. Spectrum and capital: C-Band 45.5 + 7.5 = 53.0bn; licences share of assets 158,159 / 410,186 = 38.6%; licences over goodwill 158,159 / 30,664 = 5.2 times; licences over equity 158,159 / 105,196 = 1.5 times; wireless service revenue per dollar of licences 83,703 / 157,039 = 0.53; spectrum bought June 2026 1.0 + 3.2 = 4.2bn; capex / revenue 17,011 / 138,191 = 12.3% (2025), 23,087 / 136,835 = 16.9% (2022); capex 17,011 / 23,087 - 1 = -26.3%; capex less depreciation 17,011 - 18,349 = -1,338; ROIC averages 2015-2019 (10.8 + 9.1 + 12.7 + 8.2 + 11.3) / 5 = 10.4%, 2021-2025 (8.7 + 7.3 + 5.0 + 7.0 + 7.1) / 5 = 7.0%; interest expense 6,694 / 5,524 - 1 = +21.2% (2023-2025); Q2 interest 1,985 / 1,639 - 1 = +21.1%; interest / operating income 6,694 / 29,259 = 22.9%. Cost, cash and capital returns: employees 89.9 / 99.6 - 1 = -9.7%; severance 533 + 1,733 + 1,715 + 397 = 4,378, about 4.4bn; adjusted EBITDA margin 49,997 / 138,191 = 36.2% (2025), 48,791 / 134,788 = 36.2% (2024); Q2 2026 operating income 7,179 / 8,172 - 1 = -12.2%; free cash flow Q2 6,426 / 5,167 - 1 = +24.4%; adjusted EPS less diluted EPS 4.71 - 4.06 = 0.65; phones sold below cost 28,976 - 25,470 = 3,506, about 3.5bn; dividends / free cash flow 11,481 / 20,126 = 57.0% (2025), 5,864 / 10,209 = 57.4% (H1 2026); dividends / net income 11,481 / 17,174 = 66.9%; dividends per share 2.735 / 2.230 - 1 = +22.6%, (2.735 / 2.230) ^ (1/10) - 1 = 2.1% a year; dividend cost a quarter 0.7075 x 4,155 = about 2,940; buyback average 3,500 / 72.047 = about $48.58 a share; shares 4,155 / 4,217 - 1 = -1.5%; free cash flow yield 21.53 / 193.94 = 11.1%; cash returned about (11.5 + 4.5) / 193.94 = 8.2% of market value; net unsecured debt 128,682 - 110,053 = 18,629; backlog 55.2 / 58.1 - 1 = -5.0%; backlog months 58.1 / 138.191 x 12 = about 5.0; device receivables 34,004 / 31,308 - 1 = +8.6%, allowance 1,628 / 1,315 - 1 = +23.8%; TracFone 3.5 + 3.0 = 6.5bn plus up to 0.65bn. Valuation: Frontier price / market value 22.3 / 193.94 = 11.5%; market value 193.94 / 253.94 - 1 = -23.6% (against end-2019), 193.94 / 188.06 - 1 = +3.1% (against end-2015); target 51.58 / 46.68 - 1 = +10.5%; year-end market value over net income 188.06 / 17.879 = 10.5 (2015), 217.61 / 13.127 = 16.6 (2016), 215.92 / 30.101 = 7.2 (2017), 232.30 / 15.528 = 15.0 (2018), 253.94 / 19.265 = 13.2 (2019), 243.11 / 17.801 = 13.7 (2020), 215.12 / 22.065 = 9.7 (2021), 165.47 / 21.256 = 7.8 (2022), 158.49 / 11.614 = 13.6 (2023), 168.34 / 17.506 = 9.6 (2024), 171.74 / 17.174 = 10.0 (2025); trailing twelve months to June 2026 revenue 138,191 - 67,989 + 68,693 = 138,895, net income 17,174 - 9,882 + 8,880 = 16,172, 193.94 / 16.172 = 12.0, 193.94 / 138.895 = 1.40 - customers, churn, ARPA and competitors. — 2015-2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Verizon's Forms 10-K and 10-Q, quarterly results releases, the recast segment revenue 8-K, peer results releases (T-Mobile, AT&T, Comcast, Charter) and market data; operands shown in the source line.
  6. ReportedAccounts fell while lines rose, argued on Accounts Are Shrinking, and ARPA fell 1.4% in the June 2026 quarter, argued on Revenue per Line Barely Moves.
    Verizon second-quarter 2026 results release, Form 8-K exhibit 99 - consolidated and segment results, operating statistics, cash flow, balance sheet and guidance - operating statistics: connections, net additions, churn, ARPA, upgrades and broadband. — Q2 2026 · publ. 24 July 2026 · source ↗
  7. ReportedCustomers owed $34,004 million in gross device payment receivables at the end of 2025, and a household with four lines, some still being paid off, faces four instalment balances if it wants to move.
    Verizon Communications Inc. Form 10-K for fiscal 2025 (year ended 31 December 2025) - financial statements and notes: debt, interest, pensions, receivables, performance obligations and taxes. — FY2025 · publ. 17 February 2026 · source ↗
Sources
Generated September 29, 2026