AT&T (T) early Wednesday reported first-quarter earnings that fell from a year earlier but topped estimates. The turnover was slightly missed. AT&T stock rose as wireless subscribers and free cash flow growth beat expectations.
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Reported before the market opened, AT&T earnings for the March quarter were 55 cents on an adjusted basis, down 8% from a year earlier. Revenue from continuing activities fell 0.5% to DKK 30 billion.
Analysts had expected AT&T earnings of 53 cents a share on revenue of $30.5 billion, according to FactSet. A year earlier, AT&T earned 60 cents a share on revenue of $30.1 billion from continuing operations.
In the stock market today, AT&T stock rose 1.9% to 16.81.
“The results for the quarter are encouraging and we expect to be well received,” Evercore ISI analyst Vijay Jayant said in a report. “Management reaffirmed its 2024 outlook, which includes wireless revenue growth of 3%, broadband revenue growth of 7%, adjusted EBITDA growth of 3% and free cash flow of $17 billion to $18 billion.”
Heading into the AT&T earnings report, shares were down 2% in 2024 and 10% year-over-year.
Free Cash Flow Beats
AT&T said first-quarter free cash flow came in at $3.1 billion, versus estimates of $2.4 billion. Free cash flow growth supports AT&T's dividend.
The company also said it added 349,000 postpaid mobile phone customers during the quarter vs. Wall Street estimates for a gain of 287,000.
AT&T added 424,000 postpaid phone subscribers in the same period last year. Subscriber growth has slowed down too T-Mobile USA (TMUS) and Verizon Communications (VZ) too.
Meanwhile, fewer AT&T wireless subscribers are switching to other service providers.
“Total post-paid churn of 0.89% was fully 10 basis points better than last year and 12 basis points lower than consensus estimates,” Craig Moffett, analyst at MoffettNathanson said in a report. “It might be the biggest beat in churn we've ever seen.”
Meanwhile, in February AT&T offered a $5 credit to each customer affected by a major wireless service outage. The company said the outage was caused by a network software upgrade.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cyber security and cloud computing.
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