Matt Ellis
Chief Financial Officer at Verizon Communications
Thank you, Hans, and good morning, everyone. Our results from the third quarter were not yet where we would like them to be. But as you heard from Hans, the actions we've taken in the past two quarters are gaining traction in the marketplace. As a result, we saw positive developments in store traffic and consumer phone gross adds, further gains in broadband and a sequential improvement in our financial results. We anticipate that we'll be able to build on this momentum as we head into the fourth quarter. Let's now walk through results from the third quarter, beginning with an overview of our postpaid mobility results on Slide 7.
Our strategy for mobility growth is to drive revenue growth by attracting and retaining high-quality customers and migrating them into premium tiers. Premium penetration in the consumer segment increased to approximately 42% at quarter end, a sequential increase in line with prior quarters even with the introduction of the Welcome plan and the current economic backdrop. As a result of the continued increase in premium plan penetration, combined with the benefit from our admin fee increase and the impact from metered price-ups, consumer postpaid ARPA increased 3.8% year-over-year.
Overall phone gross adds were up approximately 5% year-over-year, reflecting continued strength in business as well as the improvement in consumer gross adds. With the impact of 3Q churn, which increased as expected as a result of our recent pricing actions, phone net adds were 8,000 for the quarter. Business delivered 197,000 postpaid phone net adds in the quarter, their fifth consecutive quarter exceeding 150,000. The results were again balanced across the three customer groups with enterprise delivering their best-ever phone net add performance and SMB and public sector both seeing double-digit phone gross add growth. On the consumer side, postpaid phone gross adds were up 1.3% year-over-year, a notable sequential improvement from an 11% decline in Q2.
The launch of the Welcome plan and the Apple One Unlimited plan helped to generate more store traffic while providing another avenue to compete outside of promotional spend. We have now seen year-over-year improvement in phone gross add performance for four consecutive months through September and anticipate another low single-digit year-over-year growth performance in the fourth quarter. As expected, the pricing actions we took around administrative fees and metered plans led to an increase in disconnects. With certain price-ups being phased in throughout the third quarter, we would anticipate some disconnect pressure to carry over into Q4.
Taken together, we currently expect the gross add and disconnect performance to result in positive consumer phone net adds in the fourth quarter. Let's now discuss broadband performance on Slide 8. Total broadband net adds were 377,000 in the quarter, reflecting a strong demand for reliable and high-value broadband offerings. Fixed wireless access momentum continued throughout the third quarter. We added 342,000 net adds, up from 256,000 in 2Q, reflecting increased demand across business and consumers. More than 75% of our consumer net adds are coming from urban and suburban locations with data usage that continues to mirror our Fios customers.
We anticipate further share gains in this space as we continue to expand our household coverage and begin to realize benefits from our offering in the prepaid segment. We also added 61,000 Fios Internet net adds during the third quarter, reflecting improved gross add performance from Q2 as well as continued strong retention levels. Our ability to grow Fios in spite of some secular headwinds due to lower move activity shows that the quality, value and reliability that Fios offers continues to resonate strongly with customers. We further expanded our nationwide broadband opportunity by adding more fixed wireless households and businesses covered as well as growing our Fios open for sale within our ILEC footprint.
Total fixed wireless household coverage surpassed 40 million in the quarter, including over 30 million covered by 5G Ultra Wideband. Fios open for sale is now at 16.9 million, a year-to-date increase of 410,000, and we remain on track to hit our full year target of 550,000. Now let's talk about the value market on Slide 9. Our work to integrate TracFone continues, highlighted by the launch of our new prepaid brand, Total By Verizon, late in the quarter as well as the launch of fixed wireless for our prepaid customers earlier this month. For the quarter, we delivered positive prepaid net adds of 39,000, which excludes a base adjustment of 102,000 primarily relating to a competitor's 3G network shutdown.
We saw significant improvement in TracFone's performance, which had positive net adds for the first time since Q1 2021. With our current momentum, combined with the launch of our new brand and fixed wireless, we're excited about our positioning and ability to further grow in the value market, bringing more connectivity and benefits to customers in this space. Now let's move to the consolidated financial results on Slide 10. On a consolidated basis, total revenue was up 4.0% year-over-year as wireless service revenue growth and higher wireless equipment revenue more than offset wireline declines and the net impact of last year's M&A activity.
As a reminder, the third quarter last year only had two months of Verizon Media activity before its divestiture. Total wireless service revenue growth was up 10.0% from the prior year primarily driven by our ownership of TracFone, continued effectiveness of our Premium Unlimited strategy, and business volumes. The core business is strong as wireless service revenue, excluding all TracFone activities, grew above 3%. Additionally, we saw a benefit from the pricing actions taken earlier in the year, which we previously said would generate roughly $1 billion across Q3 and Q4. These actions helped to generate a sequential increase of $494 million in wireless service and other revenue and an increase of $345 million of adjusted EBITDA as total adjusted EBITDA came in at $12.2 billion for the quarter.
We continued to feel the pressures of higher device subsidies and promotional spending despite taking steps throughout Q3 to be disciplined, including the launch of the Welcome plan, which comes with our device subsidy. Inflationary pressures remain elevated both from a year-over-year and sequential point of view with the increase from Q2 primarily coming from higher electricity rates. Expectations for full year 2022 impacts of inflation remain consistent with comments during our Q2 earnings call. To further mitigate inflation impacts, we have started a new cost-savings program that we expect will provide a reduction in annual cost of $2 billion to $3 billion by 2025.
This program will focus on several areas within the business, including digitalization efforts to enhance the customer experience and streamlining internal operations through automation and process enhancements. While part of this will benefit the bottom line, a portion of these savings will be reinvested into the business to help accelerate opportunities. As Brady noted, adjusted EPS for the third quarter was $1.32. In addition to the impact from EBITDA, this reflects sequential pressures in interest expense due to rate increases and a reduction in other income associated with noncash changes to pension and OPEB.
Based on year-to-date interest rate increases and market expectations for additional Federal Reserve actions this year, we now estimate cash interest expense for 2022 to be about $400 million higher than our expectation coming into the year. We anticipate this pressure will continue into next year given the full year impact from interest rate increases, providing an EPS headwind in 2023. Likewise, the impact from noncash pension costs due to higher interest rates and lower return on assets this year is expected to put additional pressure on below-the-line items for 2023. Now let's take a look at our third quarter Consumer financial results.
Total Consumer revenue for the quarter grew 10.8% year-over-year driven by wireless service revenue growth of 11.0% as well as higher equipment revenue. Wireless service revenue increases were the result of the inclusion of TracFone, core wireless service revenue growth, and the impact of the pricing actions. Total Fios revenue was up versus the same period a year ago by 0.3% as growth from our Internet base offset the revenue impact of a 9% year-over-year decline in video subscribers.
Fios content costs have also dropped, resulting in an improved margin profile that we expect will continue to benefit from further shifts away from video. Consumer EBITDA was $10.6 billion, up 0.7% compared to the same period last year. The pricing actions as well as the full inclusion of TracFone results more than offset the pressures from higher promotional activity and the impact of inflation. Next, let's take a closer look at the Business financial results on Slide 12. The Business segment's wireless results remained strong in 3Q, though wireline service revenue declines continued due to ongoing secular headwinds.
Wireless service revenue growth of 5.7% was up from 3.0% last quarter, aided by pricing actions as well as continued growth in our customer base. Wireline revenue declined by 6.7% versus prior year. Operating trends are consistent with prior quarters though in Q3, we saw a sequential increase in USF revenue due to higher rates. Business EBITDA was $1.8 billion for the quarter, down 6.7% from the prior year. In addition to pressure from wireline, we experienced higher growth-related costs as wireless sales volumes were up by 15% from the prior year. Now let's move on to Slide 13 and the cash flow summary.
Cash flow from operating activities for the first three quarters of 2022 totaled $28.2 billion compared with $31.2 billion in the prior year period as working capital impacts from higher device activations and increased inventory levels continue, as we expected. Capital spending for the first three quarters of the year totaled $15.8 billion, an increase of $2.0 billion compared to last year. C-band spending was $4.5 billion for the first nine months of the year. The net result of cash flow from operations and capital spending is free cash flow of $12.4 billion for the first three quarters of the year.
We exited the quarter with $129.3 billion of net unsecured debt, a sequential improvement of $1.3 billion, resulting in a net unsecured debt-to-adjusted EBITDA ratio of 2.7x. As Hans mentioned earlier, our low unsecured bond maturities over the remainder of this year and next and strong operational cash flow generation puts our balance sheet in a strong position. Payment trends remain at or better than pre-COVID levels, and the quality of our postpaid base has never been better as evidenced by recent asset-backed securities prospectus filings.
As we look at Q3 results, we delivered the sequential revenue and EBITDA growth that we had anticipated from the actions taken in 2Q. Our guidance for 2022 remains unchanged. We are building momentum and remain confident that our strategy will deliver strong cash flow growth into the future. It is this confidence, combined with the health of our balance sheet, that enabled us to recently increase our dividend for the 16th consecutive year. We recognize the importance of the dividend to our shareholders, and we intend to continue to put the Board in a position to approve annual increases. I will now turn the call back to Hans for concluding comments before we open up to questions. Thank you.