dglobalnews.com AT&T sheds more lucrative wireless customers in 1Q
Published: Wed, April 26, 2017
Markets | By Armando Jensen

AT&T sheds more lucrative wireless customers in 1Q

AT&T sheds more lucrative wireless customers in 1Q

Overall, AT&T said it earned $3.47 billion in the first quarter and 74 cents per share, after items, which is in line with the expectations of analysts.

The Dallas-based telecom giant reported Q1 earnings per share (EPS) of $0.74, which was in-line with the Wall Street consensus estimate of $0.74.

Cash from operations was $9.2B; free cash flow came to $3.2B. Stephens called out AT&T's bundling of HBO for no extra cost with the Unlimited Plus wireless plan as helping cut subscriber churn.

"In a very competitive quarter, we continued to execute on our goals of driving efficiencies in our business while growing adjusted earnings per share", said Randall Stephenson, AT&T's chairman and CEO. Analysts were looking for $40.53 billion.

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AT&T is fighting to both keep and add customers and increase revenue amid a price war with smaller rivals T-Mobile US Inc. and Sprint Corp. AT&T also announced acquisitions of Fiber Tower and Straight Path to add millimeter wave spectrum assets to spruce up 5G.

AT&T's total operating revenue fell almost 3 percent to US$39.37 billion, mainly due to record-low sales of wireless handset sales. Compared with results for the first quarter of 2016, operating expenses were $32.5 billion versus $33.4 billion; operating income was $6.9 billion versus $7.1 billion; and operating income margin was 17.4% versus 17.6%.

The telco reported 2.7 million wireless net adds, including 2.1 million in the United States and 633,000 in Mexico. Currently, T is a Zacks Rank #3 (Hold), and is up 1% to $40.34 per share in trading shortly after its earnings report was released. "Net" subscriber additions totaled 2.1 million. However, the company said it is "no longer providing consolidated revenue guidance primarily due to the unpredictability of wireless handset sales". AT&T Inc. reports earnings Tuesday, April 25, 2017. The company expects adjusted EPS growth in the mid-single digit range, adjusted operating margin expansion, capital expenditures in the $22 billion range, and free cash flow in the $18 billion range.

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