(Reuters) -AT&T’s fourth-quarter wireless subscriber growth surpassed expectations on Monday, fueled by strong demand for its discounted premium plans combining 5G mobile with high-speed fiber data services.
Shares of the company rose about 2% in premarket trading.
The U.S. telecom giant added 482,000 net monthly bill-paying wireless phone subscribers in the holiday quarter, outpacing analysts’ estimated gains of 424,550, according to Visible Alpha.
As the pool of potential new wireless customers shrinks in the United States, AT&T’s strategy of bundling high-speed fiber internet with wireless phone services has helped drive growth for the company.
Its fiber business added 307,000 new customers in the fourth quarter, higher than 226,000 additions in the prior quarter, marking its best fourth-quarter fiber net additions.
The last three months of the year are typically strong for telecom operators, driven by factors such as Black Friday promotions, trade-in deals for new iPhone launches and the gift-giving season around Christmas, all of which contribute to higher subscriber additions.
Rival Verizon reported its best quarterly wireless subscriber growth in five years on Friday, with 568,000 monthly bill-paying wireless subscribers added in the fourth quarter.
AT&T expects annual adjusted profit between $1.97 and $2.07 per share, excluding the contribution from its 70% stake in DirecTV, which the company is selling for $7.6 billion. It was not immediately clear if the range could be compared with the estimate of $2.18 per share, according to data compiled by LSEG.
AT&T said last month that it expected free cash flow to be more than $18 billion in 2027 and would reach more than 50 million locations with fiber by 2029.
Excluding items, it reported a profit of 54 cents per share, higher than analysts’ estimate of 50 cents per share, according to data compiled by LSEG.
Total revenue rose about 1% to $32.3 billion, compared with an estimate of $32.04 billion.
AT&T began offering bill credits for network outages from Jan. 9, part of a new initiative to attract customers in a highly competitive market.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Pooja Desai)
Comments