AT&T said adjusted earnings for the three months ending in June were pegged at 63 cents per share, down 3% from last year and just ahead of the Street consensus forecast of 60 cents per share.
Revenues, the company said, rose 0.9% from last year to $29.92 billion, just shy of Street forecasts of $29.94 billion, while the group’s free cash flow was pegged at $4.209 billion, firmly ahead of forecasts, amid the group’s ongoing cost-cutting efforts.
Free cash flow after dividends, AT&T said, was pegged at $2.126 billion, providing a dividend payout ratio of 49.5%, around a third of last year’s levels.
Around 326,000 post-paid wireless subscribers were added over the quarter, the company said, just ahead of the company-provided forecast of around 300,000 and the lowest in three years.
Looking into the current year, AT&T said it’s on track to deliver adjusted earnings growth of around 3%, when compared to 2022 levels, and sees free cash flow in the region of $16 billion.
“The direction we set three years ago is sound, and we’re on the right trajectory,” said CEO John Stankey. “We’re focused on growing the right way, adding profitable 5G and fiber customers.”
“We are also committing to an incremental $2 billion-plus in cost savings beyond the $6 billion we have accomplished over this period, reflecting our continued march to operating the company in a more focused and streamlined fashion,” he added. “Our results give us full confidence in delivering our full-year financial guidance.”
AT&T shares were marked 1.62% higher in pre-market trading immediately following the earnings release to indicate an opening bell price of $15.04 each.
Last week, AT&T shares hit a three-decade low following reports that its network of legacy telecommunications cables, allegedly covered in toxic lead, that may have contaminated large areas of water and ground in the United States.
The carrier told a court in California, however, that lead cables comprise only a ‘small part’ of its overall network and pushed back on recent reports that they pose any significant risks.
AT&T added that the Wall Street Journal’s testing and reporting, which suggested the massive collective of cables may have contaminated large areas of both land and water in the United States was funded by a environmental activist fund and “targeted on sites the Journal believed were most likely to obtain the result it wanted: high lead levels.”