Jamie Spencer
AT&T (T.N) exceeded Wall Street estimates for wireless subscriber additions in the first quarter, with strong demand for its bundled high-speed fiber services and 5G mobile offerings driving growth. The company gained 324,000 net monthly bill-paying wireless phone subscribers, beating the FactSet estimate of 258,300 additions for the quarter.
Bundling and Promotions Drive Subscriber Growth
AT&T’s strategy of bundling its services, including the latest iPhones with trade-in offers, helped the company fend off competition in a saturated market. The company saw higher-than-expected device upgrades after the announcement of reciprocal tariffs in early April. CFO Pascal Desroches noted that this could lead to a pull forward in demand from the second half of the year, traditionally a strong period for telecoms with the launch of new iPhone models.
First-Quarter Revenue and Future Outlook
AT&T’s total revenue rose 2% to $30.6 billion in the first quarter, surpassing analysts’ estimates of $30.35 billion, according to LSEG data. The company also saw more than 40% of fiber customers opting for wireless plans, showcasing the success of its bundling strategy.
Improved Subscriber Retention with New Plans
AT&T’s launch of the AT&T Guarantee policy, which offers bill credits for service disruptions, has also helped attract new subscribers. The company has reaffirmed its free cash flow and adjusted profit forecasts for the year and plans to begin share repurchases in the second quarter.
Competition and Industry Trends
While AT&T’s performance exceeded expectations, rival Verizon posted higher subscriber losses in the first quarter, impacted by recent price hikes and competitive promotions. T-Mobile (TMUS.O) is set to report its results on Thursday after markets close.
