As Wall Street players and companies remain uncertain about the coronavirus outbreak’s economic impact, Verizon Communications is reporting early results of society’s virtual shutdown affect on business.
CEO Hans Vestberg on Thursday told CNBC’s Jim Cramer that data usage has surged double digits over four categories.
“In less than a week, we have transformed this company dramatically,” he said in the “Mad Money” interview.
In a week-over-week comparison, streaming demand increased 12%, Vestberg said. Web traffic climbed 20%, virtual private network, or VPN, jumped 30% and gaming skyrocketed 75%. Social media usage remained constant.
Verizon announced March 12 that it would step up its capital guidance range to $17.5 billion to $18.5 billion from $17 billion to $18 billion this year as the wireless provider prepares for the 5G transition and to support the economy through the coronavirus crisis. The company said at the time it had not seen a notable increase in data usage as the health epidemic reached pandemic levels.
Network connection is critical, especially for telecommuting and online learning.
“We’re always built for being prepared for different types of changes in the network and that’s why we’re coping so good so far in the network,” Vestberg said.
The increases come at a moment where the coronavirus pandemic has disrupted nearly every aspect of American life and commerce, along with that of the rest of the world, as health officials try to stop the fast-spreading coronavirus from sickening more people with the COVID-19 disease. The virus was first discovered in December in the Hubei province of China and has since transcended borders and oceans, infecting more than 242,700 people and leading to the death of more than 9,800 across the globe, according to data compiled by Johns Hopkins University. Nearly 85,000 have recovered as of Thursday evening.
Workplaces are making employees work remote, schools have closed their doors and restrictions are in effect on nonessential establishments as operations across America have all but halted.
Network connection has become even more critical to society as the public tries to practice social distancing. Verizon has seen “moderate growth” in network data usage, but how the data is being used has “changed dramatically,” Vestberg said.
Verizon, he said, itself 100,000 employees now working from home.
“You see that, as this country is changing quite dramatically how we operate, our network is changing, so we are constantly following those paths,” he said.
Verizon shares fell more than 1% to $53.62 in Thursday’s session. The stock closed nearly 14% below its December highs.