Verizon Communications

Economic and market conditions · Inflation and deflation pressures

Unfavorable economic conditions, such as a recession or economic slowdown in the U.S. or elsewhere, or inflation in the markets in which we operate, could negatively affect the affordability of and demand for some of our products and services and our cost of doing business.

Geopolitical and trade · Trade policies tariffs and sanctions

During the course of 2025, the U.S. government announced tariffs on goods imported from various countries to the U.S. Countries subject to such tariffs have imposed or may in the future impose reciprocal or retaliatory tariffs and other trade measures. New or increased tariffs and other trade restrictions could adversely affect our cost structure and profitability. An escalation of trade tensions, additional tariffs or prolonged uncertainty in trade relationships could also lead to supply chain disruptions or adverse economic impacts.

Natural and catastrophic events · Natural disasters and extreme weather

Our systems, networks and operations are subject to potential disruption or failure due to various factors, including power outages, natural disasters, extreme weather conditions, acts of war, or terrorist or other hostile acts, equipment, services or systems failure and human error.

Digital transformation and innovation · Artificial intelligence and automation

Finally, we are using and intend to further expand the use of AI in our operations, including in the areas of network deployment and maintenance, customer and employee support services, sales, marketing and administrative functions. There are technological, regulatory, ethical and other risks involved in deploying and using AI, particularly generative AI models. These risks could expose us to liability or adverse legal or regulatory consequences and harm our reputation. Our competitors may incorporate AI into their offerings and operations more quickly or more successfully than we do, which could impair our ability to compete effectively.

Technology infrastructure · Technology systems and infrastructure failure

Our systems, networks and operations are subject to potential disruption or failure due to various factors, including power outages, natural disasters, extreme weather conditions, acts of war, or terrorist or other hostile acts, equipment, services or systems failure and human error. Such events could result in significant damage to our infrastructure and degradation or disruption of service to our customers.

Digital transformation and innovation · Technology obsolescence and evolution

Our industries are rapidly changing as new technologies are developed that offer consumers an array of choices for their communications needs and allow new entrants into the markets we serve. In order to grow and remain competitive, we will need to adapt to future changes in technology, enhance our existing offerings and introduce new offerings to address our customers' changing demands and differentiate our services and products from our competitors.

Capital structure and performance · Credit rating and cost of capital

Our borrowing costs also can be affected by short- and long-term debt ratings assigned by independent rating agencies, which are based, in significant part, on our performance as measured by customary credit metrics. A decrease in these ratings could increase our cost of borrowing and/or make it more difficult for us to obtain financing.

Credit and liquidity · Access to capital and financing

Adverse changes in the financial markets, including increases in interest rates or changes in exchange rates, could increase our cost of borrowing, require us to post a significant amount of collateral, and/or make it more difficult for us to obtain financing for our operations or refinance existing indebtedness.

International and currency · International operations and emerging markets

A significant number of our suppliers and vendors are located or rely on operations outside of the U.S., which carries additional risks and regulatory obligations, including those related to cybersecurity, data privacy and compliance. In addition, international operations increase our exposure to other risks, such as economic and geopolitical instability, fluctuations in exchange rates, and labor-related risks.

Capital structure and performance · Debt management and refinancing

Verizon has a significant amount of debt, which could increase further if we incur additional debt in the future and do not retire existing debt. As of December 31, 2025, Verizon had approximately $131.1 billion of outstanding unsecured indebtedness, $12.0 billion of unused borrowing capacity under our existing revolving credit facility and $27.1 billion of outstanding secured indebtedness. Our debt level and related debt service obligations could have negative consequences, including requiring us to dedicate significant cash flow from operations to the payment of principal, interest and other amounts payable on our debt.

Innovation and product development · Product development and randd investment risks

If we are unable to meet future challenges from competing technologies on a timely basis or at an acceptable cost, we could lose customers to our competitors. We may not be able to accurately predict technological trends or the success of new services in the market. If our new services fail to gain acceptance in the marketplace, or if costs associated with the implementation and introduction of these services materially increase, our ability to retain and attract customers could be adversely affected.

Market position and competition · Pricing pressure and margin compression

Our competitors commonly offer aggressive pricing, promotions, premium content options and other incentives – in some cases specifically targeting our customers and putting pressure on our pricing and margins. In addition, we expect the wireless industry's customer growth rate to continue to moderate over time in comparison to historical growth rates, leading to increased competition for customers.

Legal and litigation · Product liability and warranty claims

Our wireless business is also subject to lawsuits relating to alleged adverse health effects of wireless phones and radio frequency transmitters. Any of these allegations or changes in government agencies' assessment of the risks associated with using wireless devices could result in significant legal and regulatory liability and other remedies.

Tax and financial reporting · Tax compliance and changes in tax law

Our business may be impacted by changes in tax laws and regulations, or their interpretations, and challenges to our tax positions. Tax laws and regulations are complex, dynamic, and subject to change and varying interpretations, especially when evaluated against new technologies and telecommunications services. In addition, tax legislation has been introduced or is being considered in various jurisdictions that could significantly impact our tax rate, tax liabilities, and the carrying value of deferred tax assets or deferred tax liabilities.

Legal and litigation · Intellectual property disputes

The suppliers and vendors on which we rely are and may in the future be subject to litigation with respect to technology on which we depend, including litigation involving claims of patent infringement. Such claims are frequently made in the communications industry.

Tax and financial reporting · Audit and regulatory examinations

We are also subject to ongoing audits, examinations and other tax controversies in various jurisdictions. Although we regularly assess the likelihood of an adverse outcome resulting from these controversies to determine the adequacy of provisions for taxes, the final outcome of any such controversy may be materially different from our expectations.

Industry regulation · Regulatory compliance and changes

The FCC and other federal, state and local agencies regulate our domestic operations, and various foreign governments and international bodies regulate our international operations. These regulatory regimes adopt regulations from time to time that restrict our ability to operate and provide products or services. New laws, regulations, executive orders or court decisions, or changes to the existing regulatory framework or enforcement priorities at the federal, state and local or international level could restrict the ways in which we manage our wireline and wireless networks and operate our businesses.

Reputation and brand · Brand damage and negative publicity

We believe that our reputation and brands significantly contribute to the success of our business and our relationships with our customers, employees and other stakeholders. Our reputation and brands could be negatively affected by a number of factors, including actual or alleged quality or reliability issues related to our network services and products; cybersecurity incidents and data breaches; allegations of legal noncompliance; litigation or regulatory activity; incidents involving unethical behavior or misconduct.

Core operations · Operational disruption and business continuity

Our systems, networks and operations are subject to potential disruption or failure due to various factors, including power outages, natural disasters, extreme weather conditions, acts of war, or terrorist or other hostile acts, equipment, services or systems failure and human error. Such events could result in significant damage to our infrastructure and degradation or disruption of service to our customers. For example, in early 2026, we experienced an outage resulting in a widespread disruption of service to our customers.

Supply chain and procurement · Geographic concentration of suppliers

A significant number of our suppliers and vendors are located or rely on operations outside of the U.S., which carries additional risks and regulatory obligations, including those related to cybersecurity, data privacy and compliance. Certain business practices in foreign countries may not align with U.S. laws and regulations. In addition, international operations increase our exposure to other risks, such as economic and geopolitical instability, fluctuations in exchange rates, and labor-related risks.