AT&T Rising: Q1 Rev Misses, Year Profit Growth View Tops Consensus


In the critical wireless segment, AT&T lost 191,000 postpaid phone subscribers, compared with analysts projections of a drop of 245,000, as competition in the quarter ratcheted up with service providers fighting for share with new unlimited-data plans.

AT&T is trying to diversify by buying Time Warner Inc TWX.N in a $85.4 billion deal that would give it control of cable channels like HBO and CNN as well as film studio Warner Bros.

First-quarter net income attributable to AT&T totaled $3.5 billion, or $0.56 per diluted share, compared to $3.8 billion, or $0.61 per diluted share, in the year-ago quarter.

AT&T Inc. (NYSE:T) said it added 2.7 million wireless customers, including 2.1 million in USA, driven by prepaid and connected devices. "But just as important, the strategic moves we've made over the last few months to expand our wireless capacity and fortify our 5G leadership will be felt for years to come", AT&T Chairman and CEO Randall Stephenson said in a statement. In the competitive consumer wireless market, AT&T has been focused on retaining its most profitable customers and shying away from promotional offers to grab market share.

The Dallas-based telecom giant reported Q1 earnings per share (EPS) of $0.74, which was in-line with the Wall Street consensus estimate of $0.74. The company posted first-quarter earnings excluding some items of 74 cents a share, matching analysts' predictions.

Revenues fell 2.8% from past year to $39.4 billion, missing analysts' view for $40.5 billion. In the same period from previous year, AT&T reported $0.72 in EPS and $40.53 in revenue.

AT&T stock is up 48 cents, or 1.2%, at $40.42, in late trading. AT&T also said it had 1.8 million connected devices on the 2G network it shut down in January; those 2G customers were removed from the company's subscriber count at the beginning of the year.

The company is no longer providing consolidated revenue guidance primarily due to the unpredictability of wireless handset sales. The company expects to see EPS growth in the mid-single-digit range, with free cash flow in the $18 billion range.


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