AT&T Inc (T, Financial) released its Q3 earnings report on October 19, 2023, revealing strong results driven by solid 5G and fiber subscriber growth. The company reported revenues of $30.4 billion, marking a 1% increase year over year. Operating income was reported at $5.8 billion, with adjusted operating income at $6.5 billion.
Financial Highlights
AT&T Inc (T, Financial) reported cash from operating activities of $10.3 billion, up $0.2 billion or 2.4% year over year. Year-to-date, cash from operating activities is up $1.5 billion versus the same period a year ago. Free cash flow for the quarter was $5.2 billion, up $1.3 billion year over year. Year-to-date, free cash flow is up $2.4 billion versus the same period a year ago.
The company now expects full-year free cash flow of about $16.5 billion, versus prior guidance of $16 billion or better. AT&T Inc (T, Financial) also reported an operating income of $5.8 billion, with adjusted operating income of $6.5 billion.
CEO Commentary
“Our investments in best-in-class 5G and fiber connectivity are fueling our growth engine. We’re gaining profitable customer relationships and becoming more efficient. This is powering our strong business performance and gives us the confidence to raise our full-year free cash flow guidance,” said John Stankey, AT&T CEO.
Operational Highlights
AT&T Inc (T, Financial) reported significant growth in its Mobility and Consumer Wireline sectors, offsetting a decline in Business Wireline. The company delivered 468,000 postpaid phone net adds with strong ARPU growth and historically low levels of churn. Mobility service revenues were up 3.7%, and the company achieved its best-ever Mobility operating income.
AT&T Fiber net adds were 296,000, and consumer broadband revenues were up 9.8%, driven by AT&T Fiber revenue growth of 26.9%. The company surpassed 8 million AT&T Fiber subscribers, doubling its customer base in less than 4 years.
AT&T Inc (T, Financial) continues to invest in America’s broadband infrastructure, enhancing the largest wireless network in North America and expanding the most reliable 5G network. The company is on track to pass 30 million+ fiber locations by the end of 2025.
Looking Ahead
AT&T Inc (T, Financial) is making strong progress towards achieving an incremental $2 billion+ run-rate cost savings target within the next three years. The company expects to achieve net debt-to-adjusted EBITDA in the 2.5x range in the first half of 2025.
