- Verizon signed a $1B dark fiber deal with Google
- It has other deals in the works as part of its AI Connect initiative to sell dark and lit fiber and retrofit its central offices for AI usage
- The analyst community seemed a bit underwhelmed and is taking a “wait and see” approach
During its second quarter 2026 earnings call, Verizon CEO Dan Schulman disclosed that Verizon signed an agreement with Google that is “well in excess of a billion dollars” for Google to use Verizon’s dark fiber to connect data centers.
“We have other deals that we expect to announce by year-end that, taken together, are expected to be worth multiple billions of dollars in revenue over the next several years,” said Schulman. “These are long-duration, high-quality contracted revenue streams from some of the most demanding infrastructure customers in the world.”
These deals are part of an initiative inside Verizon called AI Connect, which was launched in 2025 under former Verizon CEO Hans Vestberg.
Schulman said that the build-out of AI infrastructure across the U.S. “is one of the largest capital cycles of our lifetime, and Verizon is uniquely positioned to participate in it.”
It’s not surprising that Verizon is finally talking about this, given the fact that other long-haul and metro fiber providers have been extolling the AI climate for at least a year now. Lumen Technologies is building a new long-haul fiber route from Seattle to Minneapolis — the first such major route it’s built in decades. And in April, Zayo said it secured an anchor tenant in an AI “monster deal.”
Verizon owns one of the most extensive long-haul and metro fiber footprints in North America, which is now in demand from hyperscalers that need to connect compute to compute, model to model and region to region. “We built that infrastructure for a different era, but it has turned out to be exactly the right asset for this one,” said Schulman.
Verizon is also in the early stages of retrofitting many of its central offices into data centers for inference edge computing with multiple conversations underway with partners who need power-ready and permitted locations.
“We expect this initiative to noticeably contribute to our revenue growth starting next year and to grow substantially from there,” said Schulman.
AI Connect
AI Connect is Verizon’s internal initiative to tap into new revenue opportunities presented by AI. Schulman said that the Q2 earnings call was the first time Verizon has spoken about it publicly.
“Behind the scenes, it was clear that there was a kind of once-in-a-generation opportunity for Verizon to participate in the massive AI infrastructure build-out,” he said.
While data center connectivity demand is exploding, there's an equal amount of demand to power inference models and applications out into the edge, as well.
“Whether it's dark or lit, our assets are kind of suddenly in tremendous demand for that data center connectivity,” he said. “And we have thousands of central offices, many of which we’re taking copper out of. And we are retrofitting them to be remote data centers that are power-ready, permitted, fully redundant infrastructure.”
He said Verizon did a small trial to test the demand for its central offices and “sold out capability in 24 hours.”
Analysts underwhelmed by Verizon-Google deal
The analyst community seemed somewhat underwhelmed about the Google deal and AI Connect.
David Barden with New Street Research said, “This is still small in the grand scheme. We are also unsure what this business actually is. Is it a construction business? Or reselling existing capacity? Or something else? Something to keep an eye on.”
Peter Supino with Wolfe Reseach noted that Verizon’s wording about AI Connect being worth “multiple billions of dollars” was vague. “These are lifetime contract values of unknown durations, not annual run-rates,” said Supino.” What portion of ‘billions’ is construction at a very low margin?”
Gregory Williams with TD Cowen said that Verizon’s foray into AI infrastructure was “all gravy on top of the mobile/broadband momentum” and that AI Connect is also encouraging for other companies such as Uniti and Lumen.
Read more about Verizon and long-haul networks
Verizon CEO shuts down Starlink MVNO talk, touts strong Q2 comeback
Lumen builds new long-haul broadband route from Seattle to Minneapolis
Zayo’s long-haul business is going gangbusters because of AI