Telecommunications giant AT&T Inc (NYSE:T, ETR:SOBA) beat its financial guidance in 2023, fueled by strong operating income and cash generation from its 5G and AT&T Fiber subscriber base.
Full-year revenues saw a steady climb, totaling $122.4 billion, marking a 1.4% rise from 2022.
Mobility service revenues were up 4.4% year on year, surpassing guidance and culminating in AT&T’s best-ever year for mobility operating income.
Consumer broadband revenues were up 8.1%, also exceeding guidance, driven by full-year AT&T Fiber revenue growth of 26.6%.
The group added more than 1.7 million net postpaid phone customers in the year and 1.1 million net AT&T Fiber customers.
AT&T pursued operational efficiency throughout the year, resulting in an operating income of $23.5 billion, with an adjusted operating income of $24.7 billion ($2.41 per share), a significant turnaround from a lossmaking 2022.
“We accomplished exactly what we said we would in 2023, delivering sustainable growth and consistent business performance, resulting in full-year free cash flow of $16.8 billion, ahead of our raised guidance,” said chief executive John Stankey.
He continued: “As we advance our lead in converged connectivity, we will continue to scale our best-in-class 5G and fiber networks to meet customers’ growing demand for seamless, ubiquitous broadband, and drive durable growth for shareholders.”
Looking ahead, AT&T expects wireless service revenue growth in the 3% range and broadband revenue growth of over 7% for 2024.
Additionally, free cash flow is anticipated to be in the $17-$18 billion range with adjusted earnings per share in the range of $2.15 to $2.24.
This softer year-on-year earnings outlook reflects accelerating depreciation charges.
AT&T’s share price opened more than 2% lower on Wednesday as the market digested this softer 2024 outlook.