The Impact of AT&T’s First-Quarter Earnings Report

Key Takeaways:

• AT&T posted a mixed first-quarter earnings report, missing revenue estimates but reporting additions to its mobile and internet subscriber base.
• The telecommunications giant cited lower sales volumes and a nearly 8% year-over-year drop in its Business Wireline segment as factors affecting total revenue.
• AT&T affirmed its full-year guidance, projecting growth in wireless service and broadband revenue.

AT&T shares saw a significant jump in premarket trading following the release of its first-quarter earnings report. While the company missed revenue estimates, it reported positive growth in its mobile and internet subscriber base.

Revenue and Earnings Performance:

In the first quarter, AT&T reported total revenue of $30.03 billion, falling short of analysts’ expectations. Lower sales volumes and a 7.8% year-over-year revenue decrease in its Business Wireline division were cited as contributing factors to the revenue miss.

Diluted earnings per share (EPS) came in at 47 cents, below the expected 51 cents per share. However, adjusted EPS of 55 cents per share exceeded estimates of 54 cents per share.

Subscriber Growth:

Despite the revenue challenges, AT&T added 349,000 wireless phone subscribers in the first quarter, bringing its total mobile subscriber base to 71.6 million. Additionally, the company gained 252,000 new subscribers for its AT&T Fiber internet service.

While these numbers represent growth, they are lower than what AT&T achieved in the first quarter of the previous year.

Full-Year Guidance:

AT&T reaffirmed its full-year guidance for 2024, projecting a 3% increase in wireless service revenue and at least 7% growth in broadband revenue. The company also expects adjusted EPS to fall between $2.15 and $2.25 for the year.

While this adjusted EPS range is lower than what AT&T reported in 2023, the company anticipates growth in adjusted EPS for 2025.

Industry Comparison:

AT&T’s earnings report comes amidst a week of telecommunications companies releasing their financial results. Verizon reported results in line with analyst estimates earlier in the week, while T-Mobile is set to report its earnings on Thursday.

Shares of AT&T rose nearly 4% in premarket trading following the earnings report release, indicating positive investor sentiment.

Conclusion:

AT&T’s first-quarter earnings report showcased a mix of challenges and successes for the telecommunications giant. While revenue fell short of expectations, subscriber growth and affirmed full-year guidance point towards a positive outlook for the company.

Investors will be watching closely as AT&T navigates the evolving telecommunications landscape and works towards achieving its projected growth targets for the year.

For more information on AT&T’s first-quarter earnings report, you can read the original article on Investopedia.