AT and T: Reports Strong Second-Quarter Financial Performance

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Information Source: AT&T Inc
AT&T Inc. (NYSE: T) reported strong second-quarter results that demonstrate its ability to grow the right way by attracting high-quality 5G and fibre subscribers, while growing service revenues, resulting in improved consolidated revenues and earnings growth.
“We are winning in a highly competitive marketplace, with the nation’s largest wireless and fibre networks. Customers are increasingly choosing AT&T because we have the best technology and options for wireless and broadband connectivity, backed by the AT&T Guarantee,” said John Stankey, AT&T Chairman and CEO. “The milestones achieved this quarter – from passing more than 30 million customer locations with fibre and eclipsing 1 million total AT&T Internet Air customers, to our agreement to acquire substantially all of Lumen’s Mass Markets fibre business – strengthen the industry's best and leading connectivity portfolio.”
Second-Quarter Consolidated Results
  • Revenues of $30.8 billion
  • Diluted EPS of $0.62, versus $0.49 a year ago; adjusted EPS* of $0.54, versus $0.51 a year ago
  • Operating income of $6.5 billion; adjusted operating income* of $6.5 billion
  • Net income of $4.9 billion; adjusted EBITDA* of $11.7 billion
  • Cash from operating activities of $9.8 billion, versus $9.1 billion a year ago
  • Capital expenditures of $4.9 billion; capital investment* of $5.1 billion
  • Free cash flow* of $4.4 billion, versus $4.0 billion a year ago
Second-Quarter Highlights
  • 401,000 postpaid phone net adds with postpaid phone churn of 0.87%
  • Mobility service revenues of $16.9 billion, up 3.5% year over year
  • 243,000 AT&T Fiber net adds and 203,000 AT&T Internet Air net adds
  • Consumer fibre broadband revenues of $2.1 billion, up 18.9% year over year
  • Repurchased approximately $1.0 billion in common shares
  • Closed the sale of the entire remaining 70% stake in DIRECTV to TPG on July 2
Impact of Tax Provisions in the One Big Beautiful Bill Act
AT&T expects to realise $6.5 to $8.0 billion of cash tax savings during 2025-2027 relative to the guidance it provided at its 2024 Analyst & Investor Day due to tax provisions in the One Big Beautiful Bill Act. This reflects estimated savings of $1.5 to $2.0 billion in 2025 and $2.5 to $3.0 billion in each of 2026 and 2027.
The Company intends to invest $3.5 billion of these savings into its network to accelerate its fibre internet build-out to a pace of 4 million locations per year, a run-rate it expects to achieve by the end of 2026. As a result of this increased pace of organic fiber deployment, AT&T expects that by the end of 2030 it will reach approximately 50 million customer locations with its in-region fiber network and more than 60 million fiber locations when including the Lumen Mass Markets fiber assets it has agreed to acquire and plans to expand, its Gigapower joint venture, and agreements with other commercial open access providers1.
AT&T also intends to contribute $1.5 billion of these savings to its employee pension plan by the end of 2026, which would result in approximately 95% funding of the plan. The remaining tax savings will add to AT&T’s financial flexibility to support additional strategic investments, incremental capital returns and debt repayment, among other potential uses.
Outlook
AT&T is updating certain elements of its financial guidance for 2025-2027 to reflect the impact of expected cash tax savings, as well as its year-to-date operating performance and outlook for the remainder of 2025. For the full year 2025, AT&T expects:
  • Consolidated service revenue growth in the low-single-digit range.
    • Mobility service revenue growth of 3% or better.
    • Consumer fibre broadband revenue growth is in the mid-to-high teens.
  • Adjusted EBITDA* growth of 3% or better.
    • Mobility EBITDA* growth of approximately 3%.
    • Business Wireline EBITDA* to decline in the low-double-digit range.
    • Consumer Wireline EBITDA* growth in the low-to-mid-teens range.
  • Capital investment* in the $22 to $22.5 billion range.
  • Free cash flow* in the low-to-mid $16 billion range, including over half of the planned pension funding through 2026, discussed above.
  • Adjusted EPS* of $1.97 to $2.07.
  • Share repurchases of $4 billion for 2025, including approximately $1.3 billion completed year to date.
AT&T continues to operate the business to achieve the strategy outlined at its 2024 Analyst & Investor Day. Accordingly, AT&T reiterates its long-term financial outlook for:
  • Consolidated service revenue growth in the low-single-digit range annually from 2026-2027.
  • Adjusted EBITDA* growth of 3% or better annually from 2026-2027.
  • Adjusted EPS* accelerating to double-digit percentage growth in 2027.
  • As a result of the cash tax savings from provisions in the One Big Beautiful Bill Act, AT&T updates its financial outlook for:
  • Capital investment* in the $23 to $24 billion range annually from 2026-2027.
  • Free cash flow* of $18 billion+ in 2026 and $19 billion+ in 2027.
Note: AT&T’s second-quarter earnings conference call will be webcast at 8:30 a.m. ET on Wednesday, July 23, 2025. The webcast and related materials, including financial highlights, will be available at investors.att.com.
Consolidated Financial Results
  • Revenues for the second quarter totalled $30.8 billion, versus $29.8 billion in the year-ago quarter, up 3.5%. This was due to higher Mobility and Consumer Wireline revenues, partially offset by declines in Business Wireline and Mexico, which included unfavourable foreign exchange impacts.
  • Operating expenses were $24.3 billion, versus $24.0 billion in the year-ago quarter. Operating expenses increased, primarily due to higher equipment costs associated with higher wireless equipment revenue and higher network-related costs. Additionally, depreciation increased from our continued fibre investment and network upgrades, partially offset by lower impacts from our Open RAN network modernisation efforts. These increases were partially offset by expense declines from restructuring costs in the year-ago quarter and continued transformation efforts.
  • Operating income was $6.5 billion, versus $5.8 billion in the year-ago quarter. When adjusting for certain items, adjusted operating income* was $6.5 billion, versus $6.3 billion in the year-ago quarter.
  • Equity in net income of affiliates was $0.5 billion, versus $0.3 billion in the year-ago quarter, reflecting cash distributions received by AT&T more than the carrying amount of our investment in DIRECTV.
  • Net income was $4.9 billion, versus $3.9 billion in the year-ago quarter.
  • Net income attributable to common stock was $4.5 billion, versus $3.5 billion in the year-ago quarter. Earnings per diluted common share were $0.62, versus $0.49 in the year-ago quarter. Adjusting for $(0.08), which removes equity in net income of DIRECTV and excludes other items, adjusted earnings per diluted common share* were $0.54, versus $0.51 in the year-ago quarter.
  • Adjusted EBITDA* was $11.7 billion, versus $11.3 billion in the year-ago quarter.
  • Cash from operating activities was $9.8 billion, versus $9.1 billion in the year-ago quarter, reflecting operational growth and higher distributions from DIRECTV, partially offset by higher cash tax payments.
  • Capital expenditures were $4.9 billion, versus $4.4 billion in the year-ago quarter. Capital investment $5.1 billion, versus $4.9 billion in the year-ago quarter. Cash payments for vendor financing totalled $0.2 billion, versus $0.6 billion in the year-ago quarter.
  • Free cash flow,* which excludes cash flows from DIRECTV, was $4.4 billion, versus $4.0 billion in the year-ago quarter.
  • Total debt was $132.3 billion at the end of the second quarter, and net debt* was $120.3 billion.
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AT&T Inc
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