AT&T Q2 Earnings: A Dividend Aristocrat's Return to Form

AT&T reported Q2 earnings, exceeding expectations with EPS of 54 cents and a TTM P/E ratio of 16.79. The company's revenues were $30.8 billion, net income was $4.9 billion, and cash from operating activities was $9.8 billion. AT&T's earnings are expected to grow 6.07% next year, with a forward P/E ratio of 13.30. The telecom giant repurchased $1 billion of its common shares and closed the sale of its remaining stake in DirecTV, expected to result in $6.5 to $8 billion of tax savings. Despite losing Dividend Aristocrat status, AT&T's dividend yield is 4.06%.

AT&T Inc. (T) delivered robust second-quarter 2025 earnings, surpassing analyst expectations and demonstrating resilience in the face of market challenges. The company reported an adjusted earnings per share (EPS) of 54 cents, slightly ahead of the Zacks Consensus Estimate of 51 cents [2]. Revenue climbed to $30.8 billion, exceeding the consensus mark of $30.53 billion, driven by strong Mobility and Consumer Wireline growth [2]. Net income reached $4.9 billion, while cash from operating activities surged to $9.8 billion.

AT&T's Q2 performance highlights its commitment to expanding its 5G network and fiber internet services. The company added 479,000 postpaid net additions, including 401,000 postpaid wireless phone additions, with postpaid churn at 1.02% [2]. Net fiber additions reached 243,000, while Internet Air added 203,000 subscribers [2]. AT&T's strategic sale of its remaining stake in DirecTV is expected to generate tax savings of $6.5 to $8 billion, further bolstering its financial position [1].

Despite these positive results, AT&T stock dropped more than 2% in premarket trading, primarily due to cautious forward guidance and broader market volatility [1]. Investors were hoping for a more aggressive growth trajectory, but the company's outlook remains focused on steady revenue and EBITDA growth, with an emphasis on 5G and fiber-based connectivity.

Looking ahead, AT&T anticipates modest service revenue growth, solid gains in mobility and consumer fiber, and improved profitability for 2025. The company expects to repurchase $4 billion worth of shares and reduce its debt burden by monetizing non-core assets [2]. The forward P/E ratio is projected to be 13.30, with earnings expected to grow 6.07% next year [1].

While AT&T has lost its Dividend Aristocrat status, its dividend yield remains at 4.06%, offering investors a steady income stream [1]. The company's long-term vision of connecting people to greater possibilities with expertise, simplicity, and inspiration continues to guide its strategic decisions.

References:
[1] https://www.metatradingclub.com/att-q2-earnings/
[2] https://www.nasdaq.com/articles/t-beats-q2-earnings-estimates-higher-revenues-solid-demand