Verizon, which reported strong wireless subscriber growth but weak average user revenue earlier Friday, told analysts on an earnings call that it spent $8.9 billion on network upgrades and other improvements in the first half of the year.

But looking ahead to the second half, the company said spending would be “going down” across its wireless and wired businesses.

Verizon said it expects to spend $16.5 billion in capex for the year, meaning there’s only $7.6 billion remaining in the budget — a 15% drop from the first-half spending pace.

The move dampens what is usually the higher-spending year-end for telcos. It also comes at a time when the equipment sales market has started to tighten as giants like AT&T(T) and T-Mobile freeze orders pending merger approval.

The cut at Verizon is particularly bad news for suppliers like Ericsson(ERIC), Alcatel-Lucent(ALU), Cisco(CSCO) and Juniper(JNPR), which count on the phone giant for big gear sales.

Ericsson also offered a sign that a robust rebound in tech spending isn’t necessarily around the corner when it reported disappointing numbers Thursday. Part of the drag on business was the U.S. telco market. Ericsson CFO Jan Frykhammar said that though it wasn’t dramatic, “uncertainties” like the merger of AT&T and T-Mobile have cooled things on the buying front.

Lower or even flat spending in growth areas like mobile networks and Internet expansion may be the early signs that the tech recovery could be delayed longer than expected.


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