AT&T Tops Financial Estimates, But Internet Subscriber Growth Falls Short

AT&T (T) beat second-quarter financial estimates on Wednesday morning, as it added more monthly phone customers but fewer internet subscribers than analysts had forecast.

The telecommunications giant reported adjusted earnings per share of $0.54 for the quarter, while revenue came in at $30.8 billion, each just above what analysts had projected, per Visible Alpha estimates.

AT&T added 401,000 net postpaid phone customers, well above the analyst consensus of about 292,500, and 243,000 net AT&T Fiber internet subscribers, which was weaker than the analyst consensus.

The internet, cell service, and cable TV provider said it now expects mobility service revenue to grow by 3% or more this year, up from 2% to 3% previously, with fiber internet revenue forecast in the mid- to high teens rather than the prior mid-teens growth estimate. The company’s adjusted EPS projection of $1.97 to $2.07 stayed the same.

AT&T said it expects to see $6.5 billion to $8 billion in tax savings by the end of 2028 because of the Trump administration’s recently signed tax and spending law. The company said it plans to use the savings to fund its pension plan and speed up the pace of its fiber internet buildout.

Shares were down 3% shortly after Wednesday’s report. They entered the day up 20% since the start of this year.

AT&T’s revenue and phone subscriber additions topped estimates last quarter, while profits and internet customer growth fell short.

Earlier this week, Verizon beat estimates and narrowed its full-year outlook by raising the bottom end of its adjusted EPS growth projection. Another cell service rival, T-Mobile (TMUS), is scheduled to report its own second-quarter results after the market closes Wednesday.