Verizon Communications Inc. (NYSE:VZ) said it will record a non-cash goodwill impairment charge of roughly $5.8 billion for Verizon Business Group due to “secular declines in wireless revenue” across the unit's business groups.
In a regulatory filing, the Delaware-based telco said the unit — whose clients include businesses and government agencies — also faced continuing competitive and macroeconomic pressure.
“In the fourth quarter of 2023, in connection with its annual budget process, Verizon completed a comprehensive five-year strategic planning review of its Business reporting unit resulting in lower financial projections compared to the prior year five-year strategic planning cycle,” Verizon said in the filing.
“The revised projections were used as a key input into the Business reporting unit’s annual goodwill impairment test performed in the fourth quarter of 2023.”
Verizon said the impairment test determined that the fair value of the Business reporting unit was less than its carrying value. Following the impairment, it said the goodwill balance of the Business reporting unit reduced to $1.7 billion as of December 31, 2023.