AT&T's Q2 Revenue Surges 3.4% on Mobile User Growth, Beats Expectations

AT&T, a prominent telecommunications giant in the United States, has reported impressive financial results for the second quarter of 2023. The company's revenue grew by 3.4% to $30.8 billion, surpassing market expectations of $30.4 billion. Additionally, the adjusted earnings per share stood at $0.54, exceeding the anticipated $0.52. AT&T also reported a free cash flow of $4.4 billion for the quarter.

The robust performance was driven by a significant increase in mobile phone users, which exceeded market projections. This surge in user base contributed to the company's overall financial health, demonstrating AT&T's ability to attract and retain customers in a competitive market. The strong financial results reflect AT&T's strategic initiatives and operational efficiencies, positioning the company favorably against its rivals in the telecommunications sector.

AT&T's success in the second quarter underscores the importance of innovation and customer satisfaction in driving growth and profitability in the telecommunications sector. The company's "customer guarantee" policy, introduced in January, has been instrumental in expanding its market share. This policy promises more stable network services, superior customer service, and the most competitive smartphone plans, especially during a period when consumers are particularly concerned about inflation.

In addition to its mobile services, AT&T has been actively expanding its home internet services. Its "Internet Air" fixed wireless service added 203,000 new customers, surpassing market expectations of 169,000. The company also added 243,000 new fiber users. AT&T recently announced plans to accelerate the construction of its fiber network in response to the Tax Cuts and Jobs Act signed by Donald Trump. The company expects to save between $6.5 billion and $8 billion in cash taxes by 2027, with $3.5 billion of these savings allocated to fiber network construction. The goal is to add 4 million new access points by the end of 2026.

AT&T's strategic initiatives also include the acquisition of Lumen Technologies' consumer fiber division, further expanding its wired network coverage. The company has set a target of connecting 60 million American households to fiber by 2030, with the potential to increase this number to 70 million. AT&T has updated its full-year performance guidance, raising expectations for mobile service revenue and profit, as well as capital expenditures, while lowering expectations for fiber business revenue growth. The company maintains its forecast for adjusted earnings per share of $1.97 to $2.07. AT&T plans to repurchase $4 billion in stock this year, having already repurchased $1.3 billion so far.

AT&T is the second of the three major U.S. telecommunications companies to report its second-quarter results. T-Mobile US is expected to release its earnings report later this week. The intense competition among telecommunications giants in the United States is evident, with each company striving to enhance its service offerings and expand its customer base to maintain a competitive edge. AT&T's performance in the second quarter highlights the company's strategic initiatives and operational efficiencies, positioning it favorably against its rivals in the telecommunications sector.