The Company ended 3Q11 with cash and cash equivalents of $10.3 billion, which was up from $5.4 billion in 3Q10. Net debt reduced to $44.6 billion from $46.1 billion at the end of FY10. Net debt-to-adjusted EBITDA was stable at 1.3 times since FY10.

Verizon generated $21.5 billion cash from operations in the first nine months of 2011 compared with $25.1 billion in the first nine months of 2010. Capital expenditure increased to $12.5 billion from $11.7 billion during the same timeframe.

For FY11, the Company maintained its capital expenditure guidance of $16.5 billion. The majority of expenditure will be related to LTE upgrades.
 

• Competitive Threats: The Company's wireline business faces competition from competitive local exchange carriers, wireless carriers, long distance providers, and cable operators. Competition will intensify further in the Wireless segment with the launch of iPhone and 4G networks.

• Wireless Impact: The launch of iPhone and other smartphones will serve as negative catalysts for VZ’s own wireline customers since more customers will convert to wireless in the near future.

• Macroeconomic Environment: Telecom industries are highly vulnerable to the macroeconomic environment, and are subject to risks from changes in technology, government regulation, exposure to economic cycles, risk of slow wireless growth, and competitive pressure in the wireline industry.

• Technology: If VZ is unable to sustain its current level of innovation in technology, it will likely lose customers to its competitors. Hence, huge investment is required to continuously upgrade its technology.