Daily Management Review

AT&T Increases Its Annual Profit Projections Due To Strong Wireless Additions


AT&T Inc raised its annual profit forecast and reported a better-than-expected adjusted profit in its third quarter on Thursday, citing strong demand for its phone and internet services, as well as an increase in the number of Americans upgrading to 5G plans.
AT&T has returned to focusing on wireless services after abandoning its efforts to become a media and entertainment company, in a highly competitive telecoms market where customers are cutting back on spending due to decades of high inflation.
AT&T's promotional offers on smartphones and wireless plans assisted it in adding 708,000 net new monthly bill paying wireless phone subscribers, exceeding Factset estimates of 552,300 additions and sending its stock up 2.8 per cent before the bell.
In addition, the carrier added 338,000 fiber internet customers during the quarter and stated that it was on track to meet its annual free cash flow target of $14 billion.
AT&T has not raised its prices since a July warning that some customers were taking longer to pay their bills, forcing it to lower its forecast for annual free cash flow.
The company now expects adjusted profit per share for the full year to be $2.50 or higher, up from $2.42 to $2.46 per share previously.
According to Refinitiv data, total revenue increased 3 per cwent to $30 billion, exceeding expectations of $29.86 billion.
Income from continuing operations was $6.3 billion, up from $5 billion the previous year. Adjusted earnings per share were 68 cents, exceeding estimates of 61 cents.