Jan 24 (Reuters) - Verizon Communications ( VZ )

forecast annual free cash flow and profit below Wall Street

estimates on Friday, as the U.S. telecom major spends heavily to

expand high-speed internet services and attract customers in a

saturating wireless market.

The company has been pouring billions of dollars on the

C-band spectrum, prized for its balance of speed and range, to

improve its 5G offering and outpace rivals AT&T and T-Mobile.

The spending is also key to hitting its goal of doubling

subscribers for its fixed wireless service to as much as 9

million by 2028.

The 2025 forecast followed a strong fourth quarter for

subscriber growth as wireless additions hit a 5-year high thanks

to its customizable myPlan, Black Friday promotions and trade-in

deals for the AI-powered iPhone 16 series.

Verizon expects 2025 adjusted profit to grow between 0% and

3%, with the midpoint coming in below analysts' estimates for

growth of 2.7%, according to data compiled by LSEG.

Free cash flow, a metric that helps investors determine

dividend, is expected to be between $17.5 billion and $18.5

billion this year. The midpoint was below estimates of $18.44

billion, according to Visible Alpha.

Faced with slowing growth in the U.S. telecom market,

Verizon and its rivals have been betting on a ramp-up of

high-speed internet services to attract subscribers. The company

agreed to buy Frontier Communications in a $20 billion deal last

year.

In October, it projected 2025 capital spending between $17.5

billion and $18.5 billion, compared with $17.1 billion in 2024.

In the fourth quarter, Verizon added 568,000 monthly

bill-paying wireless subscribers, outpacing FactSet estimates of

487,500 additions. It benefited from price increases implemented

in 2024 and the popularity of myPlan, which comes with streaming

perks including Disney+, Hulu and Max at an extra cost.

Wireless equipment revenue grew about 1% to $7.5 billion in

the fourth quarter thanks to higher device upgrade volumes.

Overall revenue was $35.7 billion, slightly above estimates of

$35.32 billion.

(Reporting by Harshita Mary Varghese in Bengaluru; Editing by

Devika Syamnath)