AT&T’s sustainable growth strategy pays off with strong 2Q results

AT&T Inc. delivered strong second-quarter results with profitable subscriber growth and year over year increases in Mobility service and broadband revenues.

Consistent strategy driving strong second-quarter results

• Revenues of $29.9 billion, up 0.9% year over year
• Cash from operating activities of $9.9 billion, up 28.2% year over year and up $1.2 billion in first-half 2023 compared to first-half 2022
• Free cash flow* of $4.2 billion, up $1.0 billion in first-half 2023 compared to first-half 2022; confident in full-year free cash flow* of $16 billion or better
• Operating income of $6.4 billion, up 29.3% year over year
• On track for full-year Adjusted EBITDA* growth of more than 3%

“The direction we set three years ago is sound, and we’re on the right trajectory. Compared to last year, Mobility service and broadband revenues are up, Adjusted EBITDA is up, free cash flow is up, Mobility and Consumer Wireline margins are up and customer lifetime values are up,” said John Stankey, AT&T CEO. “We’re focused on growing the right way, adding profitable 5G and fiber customers. We are also committing to an incremental $2 billion-plus in cost savings beyond the $6 billion we have accomplished over this period, reflecting our continued march to operating the company in a more focused and streamlined fashion. Our results give us full confidence in delivering our full-year financial guidance.”

Establishing a foundation for durable, long-term growth

• Delivered 326,000 postpaid phone net adds with continued strong ARPU growth and historically low levels of churn
• Mobility service revenues up 4.9%; achieved company’s best-ever second-quarter Mobility operating income
• 251,000 AT&T Fiber net adds; 14 straight quarters with more than 200,000 net adds
• Consumer broadband revenues up 7.0%, driven by AT&T Fiber revenue growth of 28.0%
• Surpassed 5 million FirstNet® connections; FirstNet continues to be the leading choice for the first responder community
• Named #1 in wireless customer satisfaction by the American Customer Satisfaction Index

A leading investor in America’s broadband infrastructure

• Expanded most reliable 5G network1; mid-band 5G spectrum now covers more than 175 million people; remain on track to reach 200 million people with mid-band 5G by the end of the year
• Grew country’s largest consumer fiber network; ability to serve 20.2 million consumer and more than 3 million business customer
• locations with fiber; remain on track to pass 30 million-plus fiber locations by the end of 2025
• Closed joint venture with BlackRock to form Gigapower to provide a state-of-the-art fiber network to an initial 8 new areas
• Collaborated with AST SpaceMobile to achieve world-first direct voice call from space between unmodified everyday 4G LTE smartphones, connected via a low-earth orbit satellite; a key step in allowing us to provide even more expansive connectivity

Becoming more efficient and effective

• Achieved $6 billion-plus run-rate cost savings target six months ahead of schedule
• Increased target to $8 billion-plus run-rate cost savings with expectation of achieving incremental $2 billion-plus in run-rate cost savings over three years
• Accelerated cost-savings across the company with AI; collaborated with Microsoft to launch custom-built generative AI tool, Ask AT&T

CT Bureau