v3.25.4
Employee Benefits
 12 Months Ended
Dec. 31, 2025
Retirement Benefits [Abstract]  
Employee Benefits
Note 11. Employee Benefits
We maintain non-contributory defined benefit pension plans for certain employees. In addition, we maintain postretirement health care and life insurance plans for certain retirees and their dependents, which are both contributory and non-contributory, and include a limit on our share of the cost for certain current and future retirees. In accordance with our accounting policy for pension and other postretirement benefits, operating expenses include service costs associated with pension and other postretirement benefits while other credits and/or charges based on actuarial assumptions, including projected discount rates, an estimated return on plan assets, and impact from health care trend rates are reported in Other income (expense), net. These estimates are updated in the fourth quarter or upon a remeasurement event, to reflect actual return on plan assets and updated actuarial assumptions. The adjustment is recognized in the income statement during the fourth quarter and upon a remeasurement event pursuant to our accounting policy for the recognition of actuarial gains and losses.

Pension and Other Postretirement Benefits
Pension and other postretirement benefits for certain employees are subject to collective bargaining agreements. Modifications in benefits have been bargained from time to time, and we may also periodically amend the benefits in the management plans. The following tables summarize benefit costs, as well as the benefit obligations, plan assets, funded status and rate assumptions associated with pension and postretirement health care and life insurance benefit plans.

Obligations and Funded Status
(dollars in millions)
PensionHealth Care and Life
At December 31,2025202420252024
Change in Benefit Obligations
Beginning of year$7,918 $15,133 $10,539 $11,455 
Service cost160 185 33 52 
Interest cost405 479 547 543 
Plan amendments— — 1 — 
Actuarial (gain) loss, net137 (1,130)279 (533)
Benefits paid(435)(419)(801)(978)
Curtailment and termination benefits1 6 — — 
Settlements paid(215)(725)— — 
Annuity contracts transfer
— (5,611)— — 
End of year7,971 7,918 10,598 10,539 
Change in Plan Assets
Beginning of year6,802 13,536 466 466 
Actual return on plan assets456 (400)71 43 
Company contributions1,313 421 762 935 
Benefits paid(435)(419)(801)(978)
Settlements paid(215)(725)— — 
Annuity contracts transfer
— (5,611)— — 
End of year7,921 6,802 498 466 
Funded Status - End of year$(50)$(1,116)$(10,100)$(10,073)
(dollars in millions)
PensionHealth Care and Life
At December 31,2025202420252024
Amounts recognized in the balance sheets
Non-current assets$254 $— $— $— 
Current liabilities$(36)$(38)$(612)$(643)
Non-current liabilities(268)(1,078)(9,488)(9,430)
Total$(50)$(1,116)$(10,100)$(10,073)
Amounts recognized in Accumulated other comprehensive loss (pre-tax)
Prior service cost (benefit)$412 $523 $(703)$(833)
Total$412 $523 $(703)$(833)

The accumulated benefit obligation for all defined benefit pension plans was $7.9 billion at both December 31, 2025 and 2024.

Pension Annuitization
On February 29, 2024, we entered into two separate commitment agreements, one by and between the Company, State Street Global Advisors Trust Company (State Street), as independent fiduciary of the Verizon Management Pension Plan and Verizon Pension Plan for Associates (the Pension Plans), and The Prudential Insurance Company of America (Prudential), and one by and between the Company, State Street and RGA Reinsurance Company (RGA), under which the Pension Plans purchased nonparticipating single premium group annuity contracts from Prudential and RGA, respectively, to settle approximately $5.8 billion of benefit liabilities of the Pension Plans, net of certain adjustments, resulting in a net pre-tax settlement gain of $200 million.

The purchase of the group annuity contracts closed on March 6, 2024. The group annuity contracts primarily cover a population that includes 56,000 retirees who commenced benefit payments from the Pension Plans prior to January 1, 2023 (Transferred Participants). Prudential and RGA each irrevocably guarantee and assume the sole obligation to make future payments to the Transferred Participants as provided under their respective group annuity contracts, with direct payments beginning July 1, 2024. The aggregate amount of each Transferred Participant's payment under the group annuity contracts will be equal to the amount of each individual’s payment under the Pension Plans.

The purchase of the group annuity contracts was funded directly by transferring $5.6 billion, of assets of the Pension Plans, net of certain adjustments. The Company made additional contributions to the Pension Plans prior to the closing date of the transaction. With these contributions, the funded ratio of each of the Pension Plans did not change as a result of this transaction.

Pension plan assets and liabilities are primarily presented within Employee benefit obligations in our consolidated balance sheets.

Actuarial (Gain) Loss, Net
The net actuarial loss in 2025 is primarily the result of a $375 million loss ($106 million in our pension plans and $269 million in our postretirement benefit plans) due to a decrease in our discount rate assumption used to determine the current year liabilities of our pension plans and postretirement benefit plans from a weighted-average of 5.8% for our pension plans and 5.6% for our postretirement plans at December 31, 2024 to a weighted-average of 5.7% for our pension plans and 5.4% for our postretirement plans at December 31, 2025.

The net actuarial gain in 2024 is primarily the result of a $1.4 billion gain ($764 million in our pension plans and $656 million in our postretirement benefit plans) due to an increase in our discount rate assumption used to determine the current year liabilities of our pension plans and postretirement benefit plans from a weighted-average of 5.0% for both our pension and postretirement plans at December 31, 2023 to a weighted-average of 5.8% for our pension plans and 5.6% for our postretirement plans at December 31, 2024, as well as a net pre-tax settlement gain of $200 million resulting from the pension annuitization transaction discussed above.

Plan Amendments
The reclassifications from the amounts recorded in Accumulated other comprehensive income (loss) as a result of collective bargaining agreements and plan amendments made in 2016, 2017, 2018 and 2022 resulted in a net increase to net periodic benefit cost and net decrease to pre-tax income of an insignificant amount during 2025 and 2024. The similar reclassifications resulted in a net decrease to net periodic benefit cost and net increase to pre-tax income of $252 million during 2023.
Information for pension plans with an accumulated benefit obligation in excess of plan assets follows:
(dollars in millions)
At December 31,20252024
Accumulated benefit obligation$1,883 $7,881 
Fair value of plan assets1,579 6,802 

Information for pension plans with a projected benefit obligation in excess of plan assets follows:
(dollars in millions)
At December 31,20252024
Projected benefit obligation$1,883 $7,918 
Fair value of plan assets1,579 6,802 

Net Periodic Benefit Cost (Income)
The following table summarizes the components of net periodic benefit cost (income) related to our pension and postretirement health care and life insurance plans:
(dollars in millions)
PensionHealth Care and Life
Years Ended December 31,202520242023202520242023
Service cost - Cost of services$137 $159 $182 $28 $44 $46 
Service cost - Selling, general and administrative expense23 26 26 5 8 8 
Service cost160 185 208 33 52 54 
Amortization of prior service cost (credit)112 112 112 (129)(129)(419)
Expected return on plan assets(534)(620)(1,013)(28)(28)(31)
Interest cost405 479 752 547 543 545 
Remeasurement loss (gain), net216 (110)266 237 (547)726 
Curtailment and termination benefits1 — — — — — 
Other components200 (139)117 627 (161)821 
Total$360 $46 $325 $660 $(109)$875 

The service cost component of net periodic benefit cost (income) is recorded in Cost of services and Selling, general and administrative expense in the consolidated statements of income while the other components, including mark-to-market adjustments, if any, are recorded in Other income (expense), net.

Other pre-tax changes in plan assets and benefit obligations recognized in Other comprehensive (income) loss are as follows:
(dollars in millions)
PensionHealth Care and Life
At December 31,202520242023202520242023
Reversal of amortization items
Prior service cost (benefit)$(112)$(112)$(112)$129 $129 $419 
Total recognized in Other comprehensive loss (income) (pre-tax)$(112)$(112)$(112)$129 $129 $419 
Assumptions
The weighted-average assumptions used in determining benefit obligations follow:
PensionHealth Care and Life
At December 31,2025202420252024
Discount Rate5.70%5.80%5.40%5.60%
Rate of compensation increases3.00%3.00%N/AN/A
N/A - not applicable

The weighted-average assumptions used in determining net periodic cost follow:
PensionHealth Care and Life
At December 31,202520242023202520242023
Discount rate in effect for determining service cost
5.80%5.40%5.30%5.80%5.10%5.30%
Discount rate in effect for determining interest cost
5.405.205.105.404.905.10
Expected return on plan assets8.007.907.706.206.307.30
Rate of compensation increases3.003.003.00N/AN/AN/A
N/A - not applicable

In determining our pension and other postretirement benefit obligations, we used a weighted-average discount rate of 5.5% in 2025. The rates were selected to approximate the composite interest rates available on a selection of high-quality bonds available in the market at December 31, 2025. The bonds selected had maturities that coincided with the time periods during which benefits payments are expected to occur, were non-callable (or callable with certain selection criteria met) and available in sufficient quantities to ensure marketability (at least $300 million par outstanding).

In order to project the long-term target investment return for the total portfolio, estimates are prepared for the total return of each major asset class over the subsequent 10-year period. Those estimates are based on a combination of factors including the current market interest rates and valuation levels, consensus earnings expectations and historical long-term risk premiums. To determine the aggregate return for the pension trust, the projected return of each individual asset class is then weighted according to the allocation to that investment area in the trust’s long-term asset allocation policy.

The assumed health care cost trend rates are as follows:
Health Care and Life
At December 31,202520242023
Weighted-average healthcare cost trend rate assumed for next year9.30 %8.80 %7.30 %
Rate to which cost trend rate gradually declines4.50 4.50 4.50 
Year the rate reaches the level it is assumed to remain thereafter203420342032

Plan Assets
The Company’s overall investment strategy is to achieve a mix of assets that allows us to meet projected benefit payments while taking into consideration risk and return. While target allocation percentages will vary over time, the current target allocation for plan assets is designed so that 45% to 55% of the assets have the objective of achieving a return in excess of the growth in liabilities (comprised of public equities, private equities, real estate, hedge funds, and high yield bonds) and 52% to 62% of the assets are invested as liability hedging assets (where interest rate sensitivity of the liability hedging assets better match the interest rate sensitivity of the liability) and a maximum of 10% is in cash. This allocation will shift as funded status improves to a higher allocation of liability hedging assets. Target policies will be revisited periodically to ensure they are in line with fund objectives. Both active and passive management approaches are used depending on perceived market efficiencies and various other factors. Due to our diversification and risk control processes, there are no significant concentrations of risk, in terms of sector, industry, geography or company names.

As of December 31, 2025, approximately 8% of pension plan assets consist of Verizon bonds and common stock. Healthcare and life plan assets do not include significant amounts of Verizon bonds or common stock.
Pension Plans
The fair values for the pension plans by asset category at December 31, 2025 are as follows:
(dollars in millions)
Asset CategoryTotalLevel 1Level 2Level 3
Cash and cash equivalents$882 $859 $23 $— 
Equity securities8 8 — — 
Fixed income securities
U.S. Treasuries and agencies938 737 201 — 
Corporate bonds2,200 1,069 1,131 — 
International bonds139 — 139 — 
Other163 (47)210 — 
Real estate917 — — 917 
Other
Private equity417 — — 417 
Hedge funds53 — 25 28 
Total investments at fair value5,717 2,626 1,729 1,362 
Investments measured at NAV2,204 
Total$7,921 $2,626 $1,729 $1,362 

The fair values for the pension plans by asset category at December 31, 2024 are as follows:
(dollars in millions)
Asset CategoryTotalLevel 1Level 2Level 3
Cash and cash equivalents$542 $530 $12 $— 
Equity securities12 12 — — 
Fixed income securities
U.S. Treasuries and agencies720 527 193 — 
Corporate bonds1,129 627 502 — 
International bonds113 — 113 — 
Other82 (87)169 — 
Real estate934 — — 934 
Other
Private equity564 — — 564 
Hedge funds50 — 27 23 
Total investments at fair value4,146 1,609 1,016 1,521 
Investments measured at NAV2,656 
Total$6,802 $1,609 $1,016 $1,521 

The following is a reconciliation of the beginning and ending balance of pension plan assets that are measured at fair value using significant unobservable inputs:
(dollars in millions)
Real
Estate		Private
Equity		Hedge
Funds		Total
Balance at January 1, 2024$996 $512 $26 $1,534 
Actual gain (loss) on plan assets(69)55 1 (13)
Purchases (sales)12 (1)(1)10 
Transfers out(5)(2)(3)(10)
Balance at December 31, 2024934 564 23 1,521 
Actual gain (loss) on plan assets43 (53)3 (7)
Purchases (sales)(60)(90)2 (148)
Transfers out— (4)— (4)
Balance at December 31, 2025$917 $417 $28 $1,362 
Health Care and Life Plans
The fair values for the other postretirement benefit plans by asset category at December 31, 2025 are as follows:
(dollars in millions)
Asset CategoryTotalLevel 1Level 2Level 3
Cash and cash equivalents$32 $— $32 $— 
Equity securities237 237 — — 
Fixed income securities
U.S. Treasuries and agencies165 150 15 — 
Corporate bonds39 22 17 — 
International bonds13 9 4 — 
Other12 — 12 — 
Total investments at fair value498 418 80 — 
Investments measured at NAV— 
Total$498 $418 $80 $— 
The fair values for the other postretirement benefit plans by asset category at December 31, 2024 are as follows:
(dollars in millions)
Asset CategoryTotalLevel 1Level 2Level 3
Cash and cash equivalents$21 $— $21 $— 
Equity securities223 223 — — 
Fixed income securities
U.S. Treasuries and agencies149 135 14 — 
Corporate bonds45 32 13 — 
International bonds15 11 4 — 
Other10 — 10 — 
Total investments at fair value463 401 62 — 
Investments measured at NAV3 
Total$466 $401 $62 $— 

The following are general descriptions of asset categories, as well as the valuation methodologies and inputs used to determine the fair value of each major category of assets.

Cash and cash equivalents include short-term investment funds (less than 90 days to maturity), primarily in diversified portfolios of investment grade money market instruments and are valued using quoted market prices or other valuation methods. The carrying value of cash equivalents approximates fair value due to the short-term nature of these investments.

Investments in securities traded on national and foreign securities exchanges are valued by the trustee at the last reported sale prices on the last business day of the year or, if no sales were reported on that date, at the last reported bid prices. Government obligations, corporate bonds, international bonds and asset-backed debt are valued using matrix prices with input from independent third-party valuation sources. Over-the-counter securities are valued at the bid prices or the average of the bid and ask prices on the last business day of the year from published sources or, if not available, from other sources considered reliable such as multiple broker quotes.

Commingled funds not traded on national exchanges are priced by the custodian or fund's administrator at their net asset value (NAV). Commingled funds held by third-party custodians appointed by the fund managers provide the fund managers with a NAV. The fund managers have the responsibility for providing this information to the custodian of the respective plan.

The investment manager of the entity values venture capital, corporate finance and natural resource limited partnership investments. Real estate investments are valued at amounts based upon appraisal reports prepared by either independent real estate appraisers or the investment manager using discounted cash flows or market comparable data. Loans secured by mortgages are carried at the lesser of the unpaid balance or appraised value of the underlying properties. The values assigned to these investments are based upon available and current market information and do not necessarily represent amounts that might ultimately be realized. Because of the inherent uncertainty of valuation, estimated fair values might differ significantly from the values that would have been used had a ready market for the securities existed. These differences could be material.

Forward currency contracts, futures, and options are valued by the trustee at the exchange rates and market prices prevailing on the last business day of the year. Both exchange rates and market prices are readily available from published sources. These securities are classified by the asset class of the underlying holdings.

Hedge funds are valued by the custodian at NAV based on statements received from the investment manager. These funds are valued in accordance with the terms of their corresponding offering or private placement memoranda.
Commingled funds, hedge funds, venture capital, corporate finance, natural resource and real estate limited partnership investments for which fair value is measured using the NAV per share as a practical expedient are not leveled within the fair value hierarchy but are included in total investments.

Employer Contributions
In 2025, we made discretionary non-cash contributions in the aggregate principal amount of $1.3 billion to our qualified pension plans. We made contributions of $54 million to our nonqualified pension plans and $762 million of contributions to our other postretirement benefit plans. For 2026, we expect no required qualified pension plan contributions and insignificant nonqualified pension plan contributions. Contributions to our other postretirement benefit plans are estimated to be approximately $700 million in 2026.

Estimated Future Benefit Payments
The benefit payments to retirees are expected to be paid as follows:
(dollars in millions)
YearPension BenefitsHealth Care and Life
2026$1,117 $711 
2027320 755 
2028360 788 
2029401 812 
2030438 875 
2031 to 20352,663 4,489 

Savings Plan and Employee Stock Ownership Plans
We maintain four leveraged employee stock ownership plans (ESOP). We match a certain percentage of eligible employee contributions to certain savings plans with shares of our common stock from this ESOP. At December 31, 2025, the number of allocated shares of common stock in this ESOP was 38 million. There were no unallocated shares of common stock in this ESOP at December 31, 2025. All leveraged ESOP shares are included in earnings per share computations.

Total savings plan costs were $666 million in 2025, $700 million in 2024 and $724 million in 2023.

Severance Benefits
The following table provides an analysis of our severance liability:
(dollars in millions)
YearBeginning of YearCharged to
Expense		PaymentsEnd of Year
2023$653 $531 $(617)$567 
2024567 1,494 (966)1,095 
20251,095 1,491 (906)1,680 

Severance, Pension and Benefits Charges (Credits)
During 2025, we recorded net pre-tax severance charges of $1.5 billion, principally as a result of separations in connection with workforce reduction initiatives, in Selling, general and administrative expense in our consolidated statements of income. More than 13,000 employees separated from Verizon under this initiative, with the majority of these employees having exited through December 31, 2025.

During 2024, we recorded net pre-tax severance charges of $1.5 billion, principally as a result of our voluntary separation program, but also as a result of other headcount reduction initiatives, in Selling, general and administrative expense in our consolidated statements of income. In June 2024, we announced a voluntary separation program for select U.S.-based management employees. Approximately 4,800 eligible employees separated from Verizon under this program through the end of March 2025.

During 2023, we recorded net pre-tax severance charges of $531 million in Selling, general and administrative expense in our consolidated statements of income.

During 2025, in accordance with our accounting policy to recognize actuarial gains and losses in the period in which they occur, we recorded net pre-tax pension and benefit charges of $453 million in our pension and postretirement benefit plans. The net charge was recorded in Other income (expense), net, in our consolidated statement of income. This was primarily driven by a charge of $375 million ($106 million for pension plans and $269 million for postretirement benefit plans) due to a decrease in our
discount rate assumption used to determine the current year liabilities of our plans from a weighted-average of 5.8% for our pension plans and 5.6% for our postretirement plans at December 31, 2024 to a weighted-average of 5.7% for our pension plans and 5.4% for our postretirement plans at December 31, 2025, and a net charge of $78 million primarily due to changes in other actuarial assumption adjustments, which includes the difference between our estimated and our actual return on plan assets.

During 2024, we recorded net pre-tax pension and benefits credits of $657 million in our pension and postretirement benefit plans. The net gain was recorded in Other income (expense), net, in our consolidated statement of income. This was primarily driven by a credit of $1.4 billion ($764 million for pension plans and $656 million for postretirement benefit plans) due to an increase in our discount rate assumption used to determine the current year liabilities of our plans from a weighted-average of 5.0% for both our pension and post retirement plans at December 31, 2023 to a weighted-average of 5.8% for our pension plans and 5.6% for our postretirement benefit plans at December 31, 2024; a charge of $1.0 billion due to the difference between our estimated and our actual return on plan assets; and a net pre-tax settlement credit of $200 million resulting from the pension annuitization transaction discussed above.

During 2023, we recorded net pre-tax pension and benefits charges of $992 million in our pension and postretirement benefit plans. The charges were recorded in Other income (expense), net, in our consolidated statement of income and were primarily driven by a charge of $534 million due to an increase in our healthcare cost trend rate assumption used to determine the current year liabilities of our postretirement benefit plans from a weighted-average of 6.6% at December 31, 2022 to a weighted-average of 7.3% at December 31, 2023; a charge of $503 million due to a decrease in our discount rate assumption used to determine the current year liabilities of our pension plans ($288 million) and postretirement benefit plans ($215 million) from a weighted-average of 5.2% at December 31, 2022 to a weighted-average of 5.0% at December 31, 2023; a net credit of $45 million primarily due to changes in other actuarial assumption adjustments, which includes the difference between our estimated and our actual return on plan assets.