AT&T (T) Q3 2024 earnings summary

Executive summary

• Achieved strong growth in 5G and fiber, adding 403,000 postpaid phone net adds and 226,000 fiber net adds, with industry-leading postpaid phone churn at 0.78% and continued expansion of the fiber footprint.

• Q3 2024 operating revenues were $30.2B, down 0.5% year-over-year, with service revenue gains offset by lower equipment and Business Wireline revenues.

• Adjusted EBITDA rose 3.4% year-over-year to $11.6B, while a $4.4B non-cash goodwill impairment in Business Wireline led to a net loss for the quarter.

• Announced sale of remaining 70% stake in DIRECTV to TPG, expecting $7.6B in cash payments through 2029, with $0.6B received in Q3.

• Maintained focus on deleveraging, capital investment, and expanding high-value wireless and fiber businesses.

Financial highlights

• Q3 2024 revenues were $30.2B, down slightly from $30.4B in Q3 2023, mainly due to lower equipment and Business Wireline revenues.

• Adjusted EBITDA was $11.6B, up 3.4% year-over-year, with margin expanding to 38.3%.

• Adjusted EPS was $0.60, down from $0.64 last year, reflecting the impact of the $4.4B goodwill impairment; diluted EPS was $(0.03).

• Free cash flow for Q3 was $5.1B, including $0.6B from DIRECTV and a $480M one-time payment; year-to-date free cash flow was $12.8B, up $2.4B year-over-year.

• Capital expenditures for Q3 were $5.3B, with total capital investment at $5.5B; total debt stood at $129.0B, net debt at $125.8B.

Outlook and guidance

• 2024 guidance unchanged: wireless service revenue growth in the 3% range, broadband revenue growth above 7%, and adjusted EBITDA growth in the 3% range.

• Adjusted EPS guidance remains $2.15–$2.25; free cash flow tracking to $17–$18B; capital investment expected at $21–$22B.

• Net debt-to-adjusted EBITDA targeted at 2.5x by first half of 2025; on track to pass 30 million+ fiber locations by end of 2025.

• Ongoing transformation and cost reduction efforts, especially in Business Wireline.

• Continued investment in fiber and 5G network upgrades planned.