Updated at 8:51 am EST
AT&T Inc. (T) – Get AT&T Inc. Report posted better-than-expected second quarter earnings Thursday, while boosting its forecast for mobility revenue growth, but lowered its full-year cash flow forecasts as it ramps-up investment in its expanding 5G network.
AT&T said adjusted earnings for the three months ending in June were pegged at 65 cents per share, down 27% from the same period last year but just ahead of the Street consensus forecast of 61 cents per share. Group revenues from its continuing operations, the company said, fell 17% to $29.6 billion, while the group’s standalone mobility service revenues were pegged at $10.5 billion, up 4.6% from last year.
Around 800,000 post-paid wireless subscribers were added over the quarter, the company said, while overall revenue figures reflect he spin-off of its media assets into Warner Bros. Discovery (WBD) – Get Warner Bros. Discovery Inc. Report earlier this year.
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Looking into the second half of the year, AT&T said it’s lowering its full-year free cash flow forecast by $2 billion, to around $14 billion, but boosting its mobility revenue growth guidance to between 4.5% and 5%. The group also reiterated its full-year profit forecast of adjusted earnings between $2.42 and $2.46 per share.
“We’re expanding our customer base at an accelerated pace across our twin engines of growth – 5G and fiber,” said CEO John Stankey. “We’re rapidly building out our best-in-class networks on the heels of record-level connectivity investment. We’ve already added nearly 2 million AT&T Fiber locations this year and just reached our target of covering 70 million people with mid-band 5G spectrum two quarters early, with expectations to now approach the 100 million mark by the end of year.”
“Our results the last eight quarters demonstrate that our deliberate strategy of focusing on growth is helping us gain valuable customer relationships, and we’re confident in our ability to maintain this momentum while also continuing to reduce debt and deliver an attractive dividend,” he added.
AT&T shares were marked 5% lower in pre-market trading immediately following the earnings release to indicate an opening bell price of $19.46 each, a move that would trim the stock’s year-to-date gain to around 5%.