Amazon Web Services will connect its data centers over Verizon fiber for AI workloads under an agreement Verizon valued at more than $2 billion. Google signed a similar fiber deal with the carrier in July, so AWS is the second of the largest AI infrastructure builders on Verizon’s books.
Verizon disclosed the dark fiber agreement in its third-quarter results Monday morning and described it as a commercial framework for scaling distributed compute behind agentic and generative AI. The earlier Google deal, worth more than $1 billion, also used dark fiber to link data centers, as WebProNews reported at the time.
Where the $4 billion comes from
Verizon sells this work under the name AI Connect, and CEO Dan Schulman told analysts on the earnings call that it has signed almost $4 billion in contracts in six months. Other hyperscalers, neocloud providers and large enterprises are negotiating for dark or lit fiber, he said. Partners have also begun signing up to run AI inference at the edge in Verizon’s network hubs. Verizon’s first long-term contracts are expected to bring in hundreds of millions of dollars over their term.
None of that shows up in the income statement yet. Schulman said Verizon has not begun to recognize significant AI Connect revenue and expects the impact to start in 2027, and he described the extra capital as modest and tied to signed contracts. The company’s 2026 capital spending forecast of $16.0 billion to $16.5 billion already includes those AI Connect investments. Last month Verizon also locked in more than 80 million miles of fiber from Corning through 2032.
Traffic growth is the bet behind the pricing. Schulman said there could be “at least 100 billion agents” in a couple of years and that Verizon’s network “will become a scarce and crucial asset, and we will price it as such.”
AWS is short on room of its own. Amazon CEO Andy Jassy said in an interview released Friday that AWS has largely sold out its 2027 capacity and “a good chunk of 28,” even with about $220 billion in capital spending planned this year.
Schulman’s math on a SpaceX network
SpaceX came up too, after it bought low-band spectrum this month for a possible U.S. mobile network. Schulman said a terrestrial build would need 65,000 to 80,000 macro sites and at least four to six years, and he put the cost at $300 billion to $500 billion over seven or eight years. If SpaceX does build out, he said, it would become “the sixth, not the fourth, the sixth competitor in the market.”
The wireless numbers were strong. Verizon added 406,000 postpaid phone subscribers in the quarter, its best third quarter in five years and close to double the 209,439 that analysts polled by Visible Alpha expected, CNBC reported. It raised its full-year forecast to 1.1 million to 1.2 million postpaid phone additions. Revenue of $34.3 billion came in under the $34.74 billion LSEG estimate, as customers kept their phones longer after Verizon began cutting device subsidies.
The 2027 outlook, including how AI Connect feeds growth, is due on Verizon’s next earnings call.