Recently, after having increased the device sales volume significantly in the fourth quarter of 2014, Verizon Communications Inc. (NYSE:VZ) also witnessed the increase of post paid upgrades from 7.4% in Q413 to 9.8% in Q414. Increase in the upgrades of post paid connections of Verizon is a clear indication of its retained customers. This is considered as a vital factor or measuring unit in the telecommunication sector.
Why is momentum shifting in VZ? Read this analyst breakdown.
Verizon’s Customers Show Loyalty
It has been observed that during the phases of high sales (for example in Q42014), the wireless carriers’ customers tend to drift away in attractiveness of a range of promotional opportunities and incentives. However, Verizon’s customers gave a perfect example of loyalty towards it by enhancing its post paid upgrades numbers, not just sequentially, but also on YoY (year-over-year) during that quarter.
Q42014: A Fair Weather Quarter for Verizon
The sales volumes of Verizon devices also increased considerably in Q42014. New launches from companies like Apple Inc. (NASDAQ:AAPL) and SAMSUNG ELECT LTD (F) (OTCMKTS:SSNLF), led to increase in the numbers of device activations in this quarter. And, the fourth quarter of 2014 proved to be a fair weather one for Verizon, when its peer companies failed to perform as brilliantly as it did. There were more of customer additions in Verizon, in spite of the increased competition from T-Mobile US Inc (NYSE:TMUS), AT&T Inc. (NYSE:T) and Sprint Corp (NYSE:S).
Post paid upgrade drives smartphone activation for Verizon
According to Verizon, the reason for an increased in the post paid promotion is the smartphone activation during the phase. Among major upgrades, 4G smartphones accounted for the most.
Verizon indicates that out of these upgrades, 78% were inclusive of high quality and high value customers. Most of these customers took a transition from 3G to 4G devices. Meanwhile, the upgrades were also inclusive of approximately 3.2 million new customers who were not on Verizon contracts and were using the iPhones of Apple.
