Look for Verizon to continue spending to densify its 4G network in 2017. Company EVP/CFO Matt Ellis told attendees of the Morgan Stanley Media & Telecom Conference on Tuesday the carrier has moved away from spending on 3G and is 100 percent focused on 4G spend in its wireless division.
We should “start to see a little spending on 5G” as well this year, said Ellis. Fiber becomes “more important as we go to a 5G world,” he said adding that its capital spending is evolving over time as its networks are evolving. Investors should expect to see stable capital levels in 2017.
Asked about the company’s view of potential tax reform legislation currently debated in Congress, Ellis said some type of tax reform “is needed to enable U.S. companies to compete and invest. Lower rates would certainly be beneficial to us. We’re supportive of efforts underway to get that done.”
Yet he cautioned it’s difficult to assess what’s going to happen and Verizon “looks at investments based off of legislation that’s on the books.” As for deductibility of interest expenses, which has been proposed, Verizon will look “through two lenses,” meaning doing something with or without getting the deduction. “At this point we’re comfortable operating where we are today. We look forward to getting tax reform done.”
March 1, 2017
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