AT&T Inc. (NYSE:T) shares looked set to rise Wednesday after the company reported second-quarter earnings and free cash flow that topped expectations as it added more subscribers and cut costs.
The telecommunications giant’s share price has been under pressure, partly due to reports that it, Verizon and others were aware that the lead cables used as phone wires caused employees to have abnormally high amounts of lead in their blood.
The company reported revenue of $29.9 billion for the three months to 30 June 2023, up 0.9% from a year earlier. Free cash flow jumped $1 billion to $4.2 billion, higher than expected by Wall Street analysts, and AT&T added that it was confident in achieving full-year free cash flow of $16 billion or better.
Operating income rose 29% to $6.4 billion while adjusted earnings per share declined 3.1% to $0.63, beating the $0.61 consensus estimate of the Street.
“Compared to last year, Mobility service and broadband revenues are up, adjusted EBITDA is up, free cash flow is up, Mobility and Consumer Wireline margins are up and customer lifetime values are up," CEO John Stankey said in a statement.
"We're focused on growing the right way, adding profitable 5G and fiber customers. We are also committing to an incremental $2 billion-plus in cost savings beyond the $6 billion we have accomplished over this period, reflecting our continued march to operating the company in a more focused and streamlined fashion."
The company’s shares rose 2.2% to $15.12 in pre-market trading.
Contact the author at stephen.gunnion@proactiveinvestors.com