Model failure, data gap! Verizon (VZ.US) faces criticism from KeyBanc for simplifying financial report structure: "Extremely unfriendly to investors"

American telecommunications operator Verizon (VZ.US) has sparked fierce criticism from Wall Street investment bank KeyBanc Capital Markets due to major changes in its financial reporting structure. According to Verizon's latest 8-K filing with the US Securities and Exchange Commission, the company plans to change its revenue disclosure method starting from the first quarter of 2026. It will consolidate the previous two core segments of "Consumer" and "Business" into three categories: mobile and broadband services, wireless devices, and other businesses. However, this measure aimed at "simplifying" financial reports has been criticized by KeyBanc analyst Brandon Nispel as "extremely unfriendly to investors," as it not only eliminates key historical comparison dimensions but also objectively weakens market transparency. KeyBanc pointed out in a research report that Verizon's new disclosure model actually makes it difficult for external analysts to accurately model finances. For example, Verizon provides average revenue per account (ARPA) data for wireless retail postpaid service but does not provide corresponding account metrics. Although it discloses the number of postpaid smartphone users, it does not provide average revenue per user (ARPU) data for postpaid smartphones. While it provides the number of broadband users, it does not provide ARPU data. Therefore, KeyBanc believes that it is fundamentally impossible to derive any data with historical comparability from this. On Monday, KeyBanc stated, "We believe the biggest current issues are twofold: lack of transparency in information disclosure and lack of comparability in data, making it difficult for outsiders to understand the actual progress of its business transformation." KeyBanc also felt that Verizon must have "carefully selected" some favorable indicators for disclosure while quietly hiding those indicators that were unfavorable. Meanwhile, despite Verizon also providing more positive financial guidance, this has not alleviated market concerns. According to data disclosed by Verizon, its total revenue for wireless and broadband businesses in 2025 reached $90.86 billion. KeyBanc considers this data crucial because Verizon has given a performance guidance of $93 billion for the same business indicators in 2026, with an expected year-on-year growth rate between 2% and 3%. The research institution stated, "This situation suggests that either Verizon's FiOS business revenue, wireless service revenue, or both are declining, or Verizon's performance guidance may be too conservative." It is worth noting that even though Verizon currently maintains a high dividend yield of about 5.44%, the regression in disclosure mechanisms undoubtedly increases the difficulty of evaluating its long-term sustainable growth and has led investors who were originally optimistic about the company to begin examining the potential business risks behind its financial reporting reform.