AT&T (NYSE: T) stock rose 2% in intraday trading Wednesday after the company revealed better-than-expected growth in wireless subscribers and free cash flow in the first quarter.
AT&T (T) announced its first-quarter earnings early Wednesday, which, while lower than the previous year, surpassed estimates. Despite a slight miss in revenue, the company showcased robust growth in wireless subscriber additions and free cash flow.
AT&T reported total revenue of $30.03 billion, falling short of analysts’ expectations of $30.54 billion, according to estimates compiled by Visible Alpha. Lower sales volumes and a 7.8% year-over-year revenue decline in its Business Wireline division weighed on AT&T’s top line.
Diluted earnings per share (EPS) came in at 47 cents, below the expected 51 cents per share. However, adjusted EPS of 55 cents per share surpassed the estimated 54 cents per share. Comparatively, in the same period last year, AT&T earned 60 cents a share on revenue of $30.1 billion from continuing operations.
Free Cash Flow Beats
Despite these mixed results, AT&T delivered impressive performance in key metrics. The company reported first-quarter free cash flow of $3.1 billion, surpassing estimates of $2.4 billion.
The company also announced an addition of 349,000 postpaid wireless phone customers during the quarter, outperforming Wall Street’s projected gain of 287,000. However, this figure marks a slowdown compared to the 424,000 postpaid phone subscribers added in the year-earlier period, mirroring trends observed at competitors like T-Mobile US (NASDAQ: TMUS) and Verizon Communications (NYSE: VZ).
Moreover, AT&T experienced a decline in subscribers switching to other service providers.
Full-Year Guidance
AT&T has also issued full-year guidance for 2024. The company expects a 3% rise in wireless service revenue and at least 7% growth in broadband revenue. The company expects adjusted EPS to range from $2.15 to $2.25, below the $2.41 reported in 2023. However, AT&T anticipates adjusted EPS growth in 2025.
AT&T (NYSE: T) Stock Reaction
At the time of this report, the price of AT&T stock is $16.81, indicating a 1.88% increase from the previous trading session. This week, it has surged in value by 4.28%. Trading activity has seen 74,197,832 (74.19 million) shares changing hands, significantly higher than the average daily volume of 38.39 million.
