DALLAS, September 06, 2023

John Stankey Updates Shareholders at the 2023 Goldman Sachs Communacopia + Technology Conference

AT&T confident in full-year guidance, including free cash flow of better than $16 billion and adjusted EBITDA growth of 3+ percent


Key Takeaways:

  • AT&T remains on track to generate full-year free cash flow of better than $16 billion driven by its successful and sustainable long-term growth strategy.
  • AT&T expects to deliver continued profitable 5G and fiber net additions in the third quarter, highlighted by low customer churn, higher postpaid average revenues per user (ARPU), solid year-over-year mobility EBITDA growth and healthy wireless service revenue growth.
  • AT&T is well-positioned for the future of converged connectivity as the only scaled services provider that has owner’s economics on both wireless and fiber. The company continues to be one of the largest investors in America’s digital infrastructure and is progressing on its 5G and fiber network builds. AT&T remains committed to deploying 5G+ on mid-band spectrum to 200 million people by year-end 2023 and to passing 30+ million consumer and business customer locations with fiber by the end of 2025.

John Stankey, chief executive officer, AT&T* (NYSE:T) Inc., spoke today at the Goldman Sachs Communacopia + Technology Conference where he provided an update to shareholders. Stankey made the following key points:

The company’s strategy and renewed focus on core connectivity is working.

  • Stankey stated that AT&T is benefitting from the continued and consistent execution of the strategy it laid out three years ago and that the company is now repositioned around its strengths in 5G and fiber connectivity.
  • Stankey shared that the company added 8 million+ postpaid phones and 3 million+ fiber subscribers since July 2020. In the second quarter of 2023, AT&T grew wireless service revenue by $2 billion+ compared to the second quarter 2020 and generated record mobility 2Q EBITDA.
  • The company achieved this success over the last 3 years as it invested around $100 billion in capital investment and spectrum in America’s infrastructure, while also lowering net debt by approximately $20 billion.

AT&T’s 2023 full-year free cash flow on target.

  • Stankey also reiterated that he’s confident in the company’s full-year guidance. This includes free cash flow of better than $16 billion. As previously indicated, the primary factors supporting the company’s cash outlook are expectations for full-year 2023 adjusted EBITDA growth of 3-plus percent, largely in-line capital investment and lower handset payments for full-year 2023 compared to 2022.

AT&T remains focused on growing durable relationships with high-quality 5G & fiber customers.

  • Stankey highlighted that connectivity convergence is only becoming more important. As convergence accelerates, AT&T is well positioned to achieve sustainable subscriber and profit growth because it owns and operates a scaled wireless and fiber network. Unlike others in the industry, when AT&T adds converged subscribers, it realizes economic benefit from both wireless and fiber.
  • In wireless, Stankey said the company’s disciplined go-to-market strategy is sustainable and continuing to resonate with customers. This is allowing AT&T to grow service revenue at a faster rate than the industry. The company expects steady wireless subscriber growth in the third quarter as a result of:
  • Healthy subscriber demand;
  • A rational competitive environment; and
  • Positive subscriber porting trends with no material change in porting ratios, including to cable.
  • In fiber, Stankey stated that AT&T expects continued solid subscriber growth in the third quarter even with lower household move activity. Where AT&T has fiber, it continues to win in both fiber and wireless.
  • Stankey also shared that the opportunity for fiber continues to expand thanks to better-than-expected AT&T Fiber penetration rates that are now 2x greater in year one of a new fiber build compared to builds in the company’s first markets. He said the return case for fiber investment is also supported by higher ARPUs, longer customer lifecycles, quality of service and fiber product longevity.

Investing in the future of America’s connectivity

  • AT&T is focused on becoming America’s best connectivity provider, whether our customers are at home, work or on the move. Our connectivity toolkit includes multiple technologies, including 5G, fiber and our fixed wireless access product AT&T Internet Air.
  • AT&T is committed to its mission of bringing access to super-fast, reliable, high-capacity fiber service to more Americans, which it is pursuing through a three-pronged approach.
  • The company remains committed to its goal to pass 30+ million consumer and business customer locations with fiber in its traditional service area by the end of 2025. It is simultaneously pursuing additional fiber opportunities outside its traditional service area via the Gigapower joint venture with BlackRock. And it has opportunities to further expand the availability of fiber with government funding, both inside and outside its traditional service areas, through the more than $40 billion available via the Broadband Equity Access and Deployment (BEAD) Program.
  • The company remains on track with all of its 5G and fiber network expansion commitments. AT&T’s nationwide 5G network reaches about 290 million people, including 175 million people with 5G+ delivered over midband 5G spectrum. It expects to deploy 5G+ to 200 million people by year-end 2023. AT&T also now passes 25 million+ consumer and business fiber locations.1

The webcast of Stankey’s conversation is available for replay at AT&T Investor Relations

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