Shares of AT&T Inc. (NYSE: T) rose 1.42% in pre-market trading Wednesday after the company reported better-than-expected second-quarter earnings and robust free cash flows.
The telecom giant reported adjusted earnings of 63 cents per share for the three months ending in June. Although this reflected a 3% decline from the previous year, it still beat the Street consensus forecast of 60 cents per share.
The company’s revenues also grew, reaching $29.92 billion, a 0.9% increase from the previous year, albeit slightly lower than the Street’s forecast of $29.94 billion.
The group’s free cash flow came in at $4.209 billion, firmly ahead of forecast, amid the group’s ongoing cost-cutting efforts.
The company’s free cash flow after dividends was pegged at $2.126 billion. This provided a dividend payout ratio of 49.5%, around a third of last year’s levels.
Furthermore, AT&T managed to add around 326,000 post-paid wireless subscribers during the quarter. This number exceeded the company’s forecast of approximately 300,000 additions. However, this number was also reported to be the lowest in three years.
AT&T provided a positive outlook for the rest of the year. The company expects adjusted earnings to grow by approximately 3% compared to 2022. In addition, the company anticipates free cash flow to reach $16 billion.