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AT&T Inc. is a telecommunications company that operates primarily through two reportable segments: Communications and Latin America. The company provides wireless and wireline telecom and broadband services to consumers in the U.S. and businesses globally, with a focus on expanding its 5G and fiber networks to drive growth in wireless and broadband services . AT&T's Communications segment includes Mobility, Business Wireline, and Consumer Wireline, while the Latin America segment offers wireless services and equipment in Mexico .
- Communications - Provides telecom and broadband services to U.S. consumers and businesses globally, focusing on wireless and wireline services.
- Mobility - Offers nationwide wireless services and equipment, significantly contributing to the segment's revenue.
- Business Wireline - Delivers advanced ethernet-based fiber services, IP Voice, and managed professional services to businesses.
- Consumer Wireline - Offers broadband services, including fiber connections, to consumers.
- Latin America - Provides wireless services and equipment in Mexico, contributing a smaller portion of the company's total segment operating revenues.
- Can you provide more details on the progress of your multiyear cost-cutting targets, and how confident are you that EBITDA growth will outpace consolidated service revenue performance, especially amid potential operational challenges?
- Given concerns about a potential volume slowdown in the wireless industry and limited room for further pricing actions, how do you plan to sustain growth in your mobility segment, and do you share these concerns about volumes and pricing power?
- With the anticipated $480 million one-time payment related to your wireless network transformation in the back half of the year, can you elaborate on what this payment entails and whether it was fully contemplated within your original guidance?
- You mentioned a 500 basis point market share advantage in areas where you've deployed fiber; could you share more concrete data supporting your argument that convergence is a critical strategy and explain how AT&T is uniquely positioned to capitalize on these economics beyond market share gains?
- Considering recent network outages and data breaches, how have these events impacted your go-to-market strategy, and do they pose any risks to your future financial performance?
Competitors mentioned in the company's latest 10K filing.
- América Móvil: Significant market share competitor in Mexico for wireless services .
- Two national wireless providers: Competitors in the U.S. service areas for wireless services .
- Regional providers and resellers: Competitors in the U.S. service areas for wireless services .
- Certain cable companies: Competitors in the U.S. service areas for wireless services .
- Providers offering voice, text messaging, and other services as applications on data networks: Competitors in the wireless market .
- Large cable companies and wireless broadband providers: Competitors for high-speed internet and voice services in most U.S. markets .
- Wireless, cable, and VoIP providers: Competitors for legacy voice and data services, offering comparable services at lower prices .
- Large internet service providers, wireless carriers, other telephone companies, cable companies, and systems integrators: Competitors for local and interstate telephone and switched services .
Recent developments and announcements about T.
Financial Reporting
- Revenue and Profit: Fourth-quarter revenues increased nearly 1%, driven by wireless service, equipment, and broadband revenues, partially offset by declines in Business Wireline. Adjusted EBITDA grew by 2.2%, and adjusted EPS was $0.54, consistent with the prior year.
- Free Cash Flow: AT&T reported $4.8 billion in free cash flow for the quarter, with full-year free cash flow at $17.6 billion, slightly above the midpoint of its guidance.
- Mobility Segment: Mobility revenues grew 3.3% in Q4, with postpaid phone ARPU at $56.72, up nearly 1% year-over-year. Postpaid phone churn remained low at 0.85%.
- Consumer Wireline: AT&T Fiber added 307,000 net subscribers in Q4, its highest ever, with fiber ARPU increasing 4.7% year-over-year to $71.71. Broadband revenues grew 7.8%, driven by fiber revenue growth of 17.8%.
- Fiber and 5G Expansion: AT&T continues to invest heavily in its fiber and 5G networks, with $22 billion in capital investment in 2024. The company plans to maintain this level of investment in 2025.
- Cost Savings: AT&T has set a $3 billion cost savings target through 2027, focusing on AI integration and transitioning away from legacy copper networks.
- Customer Experience: The company introduced the AT&T Guarantee, a promise to deliver reliable connectivity and excellent service, covering both wireless and fiber networks.
- 2025 Outlook: AT&T expects adjusted EPS of $1.97 to $2.07 and free cash flow of $16 billion or more. Mobility service revenue growth is projected in the higher end of the 2%-3% range, with EBITDA growth in the higher end of the 3%-4% range.
- Dividend and Share Buybacks: The company plans to maintain its dividend and commence share buybacks in the second half of 2025, as it targets a net debt-to-adjusted EBITDA ratio of 2.5x.
- Fiber ARPU Growth: Analysts inquired about the sustainability of fiber ARPU growth. Management attributed the growth to pricing actions, plan mix, and a shift from copper to fiber products.
- Mobility Market Trends: Questions about the wireless market's normalization were addressed, with AT&T emphasizing its focus on balancing volume growth and ARPU improvements.
- AI and Cloud Integration: Management highlighted the use of AI to improve customer service, operational efficiency, and network performance, while also exploring opportunities to leverage its infrastructure for AI applications.
- Revenues: $32.3 billion, up 0.9% year-over-year, driven by higher Mobility service and equipment revenues and Consumer Wireline revenues, partially offset by declines in Business Wireline and Mexico.
- Net Income: $4.4 billion, a significant increase from $2.6 billion in the year-ago quarter.
- Earnings Per Share (EPS): $0.56 per diluted share, up from $0.30 in the prior year. Adjusted EPS was $0.54, consistent with the year-ago quarter.
- Adjusted EBITDA: $10.8 billion, up from $10.6 billion in the prior year.
- Free Cash Flow: $4.8 billion, down from $6.4 billion in the year-ago quarter, reflecting a more ratable quarterly free cash flow cadence.
- Revenues: $23.1 billion, up 3.3% year-over-year, driven by service revenue growth of 3.3% and equipment revenue growth of 3.3%.
- Postpaid Phone Net Adds: 482,000, with an industry-leading postpaid phone churn of 0.85%.
- EBITDA: $8.9 billion, the highest-ever fourth-quarter Mobility EBITDA for AT&T, reflecting service revenue growth.
- Revenues: $3.5 billion, up 3.4% year-over-year, driven by broadband revenue growth of 7.8%, particularly in fiber.
- Fiber Broadband Net Adds: 307,000, marking 20 consecutive quarters of 200,000+ net adds.
- EBITDA: $1.2 billion, up 9.8% year-over-year, with an EBITDA margin of 35.2%.
- Revenues: $4.5 billion, down 10.0% year-over-year, reflecting continued declines in legacy voice and data services.
- EBITDA: $1.2 billion, down 22.0% year-over-year.
- Capital Expenditures: $6.8 billion, up from $4.6 billion in the year-ago quarter, reflecting investments in network modernization and fiber expansion.
- Debt Management: Total debt at the end of the quarter was $123.5 billion, with net debt at $120.1 billion.
- DIRECTV Sale: The company expects to close the sale of its 70% stake in DIRECTV to TPG by mid-2025.
- Service Revenue Growth: Low-single-digit range for consolidated services, with Mobility service revenue growth at the higher end of 2%-3%.
- Free Cash Flow: Expected to exceed $16 billion, excluding DIRECTV.
- Adjusted EPS: Projected between $1.97 and $2.07, excluding DIRECTV.
Earnings Call
·
Jan 27, 2025, 3:36 PM
AT&T has released its fourth-quarter earnings call transcript, providing key insights into its financial performance and strategic initiatives:
Financial Performance:
Strategic Initiatives:
Forward Guidance:
Analyst Questions and Management Responses:
Key Takeaways:
AT&T demonstrated strong financial performance in 2024, driven by growth in its Mobility and Consumer Wireline segments. The company remains focused on expanding its fiber and 5G networks, achieving cost efficiencies, and enhancing customer experience. Its 2025 guidance reflects confidence in continued growth and operational improvements.
For more details, visit AT&T's Investor Relations website.
Earnings Report
·
Jan 27, 2025, 12:00 PM
AT&T Fourth Quarter 2024 Earnings Results
AT&T has released its fourth-quarter 2024 earnings results, showcasing key financial and operational highlights:
Key Financial Metrics
Segment Highlights
Mobility
Consumer Wireline
Business Wireline
Operational and Strategic Updates
Outlook for 2025
AT&T reiterated its full-year 2025 guidance, including:
For more details, visit AT&T Investor Relations.
Note: All financial figures are unaudited and subject to adjustments. Non-GAAP measures such as Adjusted EBITDA and Adjusted EPS are reconciled in AT&T's financial disclosures.