Key Highlights
- First quarter adjusted earnings per share of $0.57 surpassed Wall Street’s $0.55 forecast
- Total revenue hit $31.5 billion, marking a 2.9% annual increase and beating the $31.25 billion projection
- Postpaid phone subscriber additions reached 294,000, exceeding analyst expectations of 270,000
- Shares climbed 0.8% in response to the earnings announcement
- Company maintained its 2026 full-year outlook, projecting free cash flow of no less than $18 billion
The telecommunications giant delivered an encouraging first quarter performance on Wednesday, surpassing analyst projections across earnings, revenue, and customer acquisition metrics.
The company’s adjusted earnings per share landed at $0.57, outpacing the consensus forecast of $0.55. Total revenue climbed to $31.5 billion, representing a 2.9% year-over-year increase and exceeding the $31.25 billion analyst projection.
Shares moved 0.8% higher following the earnings release.
The telecom operator brought in 294,000 new postpaid phone subscribers during the three-month period. Wall Street had anticipated approximately 270,000 to 272,000 additions, making this a notable outperformance.
The company’s convergence approach continues gaining traction. Between 42% and 45% of AT&T’s residential broadband customers maintain both internet and wireless services — a bundling tactic that has emerged as a significant competitive advantage.
Internet subscriber growth totaled 584,000 for the quarter, distributed equally between fiber and fixed wireless platforms: 292,000 additions each.
AT&T and competitor T-Mobile both maintained device promotion programs throughout the first quarter, aggressively pursuing market share through iPhone incentives and promotional pricing.
Rate Adjustments
The carrier implemented price increases on its entry-level and premium wireless offerings. The strategic objective centers on steering subscribers toward middle-tier plans while increasing average revenue per customer.
Industry observers suggest this pricing adjustment represents a calculated effort to optimize customer value rather than trigger competitive pricing responses.
Business Unit Realignment
Beginning with this reporting period, the company restructured its operational segments to emphasize strategic growth priorities.
The newly established Advanced Connectivity division — encompassing domestic 5G wireless and fiber networks — delivered approximately 5% revenue expansion. Service revenue within this segment increased 3.6% annually to $22.9 billion. Operating income surged 14.8% to $6.9 billion.
Portion of this expansion stems from the fiber assets acquired from Lumen’s mass market division.
Free cash flow registered at $2.5 billion, compared with $3.1 billion in the corresponding quarter last year. The decline reflects elevated capital investment as the company intensifies fiber network expansion.
Capital expenditures totaled $4.9 billion during the quarter, up from $4.3 billion in the same period a year earlier.
CEO John Stankey characterized it as the “best first quarter ever for Advanced Connectivity internet customer net additions.”
The company reiterated its 2026 annual guidance: adjusted earnings per share ranging from $2.25 to $2.35, EBITDA expansion of 3% to 4%, and free cash flow of at least $18 billion.
Management also confirmed its commitment to repurchasing roughly $8 billion in shares throughout 2026.
