AT&T adds more wireless subscribers than expected; shares rise


The AT&T logo is seen in a store window, as airports around the country are awaiting for Verizon and AT&T to rollout their 5G technology, in the Manhattan borough of New York City, New York, U.S., January 19, 2022. REUTERS/Brendan McDermid

(Reuters) -AT&T Inc's better-than-expected quarterly subscriber additions overshadowed a $25 billion non-cash charge related to the impact of higher interest rates on its businesses and triggered a 6% rise in its shares.

The carrier has used discounts and trade-in offers to lure customers in the highly competitive telecoms market, as it ramps up competition with Verizon and T-Mobile US after shedding its media business last year.

"With improving churn numbers and strong 5G wireless net adds, AT&T is entering 2023 in a good position," Third Bridge analyst Jamie Lumley said.

But indicators point to the company running out of room for growth in the near future, Lumley added.

Apart from 5G technology, AT&T is also investing in bolstering its fiber-optic network, which lets it sell both broadband services and video packages. The company added 280,000 fiber customers in the December quarter.

AT&T on Wednesday forecast adjusted earnings in the range of $2.35 and $2.45 per share, which included a 25-cent charge related to non-cash pension costs and an expected higher tax rate. Analysts were expecting a profit of $2.56 per share, according to Refinitiv data.

As the United States stares at a recession, companies are turning increasingly cautious about growth and taking big steps to cut costs.

"We don't have an outlook that says we've solved the (economy) problem," Chief Executive John Stankey told analysts on a conference call.

"We will be operating in a challenging macroeconomic environment where wireless industry growth is likely to return to more normalized levels."

For the latest quarter, AT&T added 656,000 postpaid phone subscribers, above Factset estimates of 644,800 additions. The number also came in well above Verizon's 217,000 additions, although it failed to match T-Mobile's expected 927,000 additions.

(Reporting by Samrhitha Arunasalam and Eva Mathews in Bengaluru; Editing by Anil D'Silva)

Article type: free
User access status:
Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!

   

Next In Tech News

'Shock to the education system': This AI chatbot is already writing school essays and could rewrite the future of learning
Opinion: To AI or not to AI? It’s not even a question Hollywood is embracing artificial intelligence
Opinion: AI voices for audiobooks is a strange new trend
How 'crunch' time and low pay are fuelling a union drive among video game workers
Preview: 'Like a Dragon: Ishin!’ brings an old formula into the past
Elon Musk says to attempt Starship launch in March
Advisory firm Innisfree sues Musk's Twitter for $1.9 million in unpaid bills
ChatGPT makers launch tool to spot AI texts – but it's not very good
U.S. judge denies FTC request to stop Meta from acquiring VR firm Within
Two minutes a day to be authentic: Does BeReal show real life?

Others Also Read