In a recent update addressing the state of AT&T, CEO John Stankey provided insights into the evolving dynamics of the wireless industry and the company’s ambitious plans for growth in fiber services. During a discussion at the Goldman Sachs Communacopia Conference, Stankey noted that AT&T is noticing stable yet normalizing trends within their wireless sector, reflecting a shift that investors should closely monitor.
AT&T’s performance in the Mobility business has met expectations for the third quarter, demonstrating resilience in its service offerings. Notably, fiber deployment is progressing beyond initial projections, positioning AT&T to capitalize on burgeoning demand for high-speed internet. Despite a current work stoppage impacting fiber installations, the anticipated effects on the company’s financial performance for the upcoming quarter are expected to be minimal.
Looking ahead, AT&T forecasts capital expenditures of between $21 billion and $22 billion for the year 2024, which will primarily support its 5G and fiber expansion efforts. The CEO indicated a commitment to achieving over $2 billion in recurring cost savings by mid-2026. Additionally, the company aims to bring its net-debt-to-adjusted EBITDA ratio down to around 2.5x in the first half of 2025, signifying a robust focus on optimizing financial health.
The company reiterated its financial guidance originally set out in July, projecting wireless service revenue growth in the 3% range for fiscal year 2024, alongside broadband revenue growth exceeding 7%. Furthermore, Stankey highlighted an anticipated adjusted earnings per share (EPS) between $2.15 and $2.25, slightly below the consensus estimate of $2.20. Full-year adjusted EBITDA growth is also on track to fall within the 3% range, with expected free cash flow reaching between $17 billion and $18 billion.
For investors looking to gain exposure to AT&T’s stock performance, vehicles such as the iShares MSCI USA Value Factor ETF and the ETC 6 Meridian Mega Cap Equity ETF present viable options.
In addition to these highlights, AT&T recently made headlines by resolving technical issues that affected wireless services across several major American cities, demonstrating a proactive approach to service reliability.
As AT&T navigates a competitive landscape, its focus on enhancing service offerings and strategic investments in fiber technology not only signals a commitment to customer satisfaction but also positions the company favorably for sustainable growth in an ever-evolving digital market.