John Stankey, chief executive officer, AT&T* (NYSE:T) Inc., spoke today at the UBS Global Media & Communications Conference where he provided an update to shareholders. Stankey made the following key points:
The company’s focus on leading in connectivity, is working.
- Stankey reiterated that AT&T continues to benefit from the focused strategy it laid out three years ago – to be the best broadband connectivity provider in America. By executing a consistent playbook, the company is powering customer growth, improving returns and enabling additional investments that are benefiting the business today.
- AT&T’s simple and consistent go-to-market approach continues to resonate with customers and has created a sustainable model for healthy growth and strong cash conversion.
- The company successfully invested around $100 billion in capital investment and spectrum in America’s infrastructure, while also lowering net debt by approximately $20 billion over the three-year period that ended with the second quarter of 2023.
AT&T is on track for 2023 full-year free cash flow of about $16.5 billion.
- The company remains confident in its ability to deliver free cash flow of about $16.5 billion this year.
- Stankey reiterated the company remains focused on driving incremental efficiencies with an additional $2 billion-plus in savings by mid-2026. This is largely driven by sunsetting legacy products and supporting infrastructure. The company also continues to see benefits from the deployment of AI to better serve customers.
- The company remains on track to reduce net debt and to achieve a leverage target of 2.5x net-debt to adjusted EBITDA in the first half of 2025. Additionally, AT&T remains in a strong position to pay for the next two years of debt maturity towers as they come due with cash on hand, given 95% plus of its debt is fixed at an average rate of 4.2% with a weighted average maturity of 16 years.
AT&T remains focused on growing durable relationships with high-quality 5G & fiber customers.
- Stankey highlighted that AT&T is uniquely positioned to take advantage of its owned and operated scaled wireless and fiber networks. Unlike others in the industry, the company realizes economic benefit from both wireless and fiber when it adds converged subscribers.
- Stankey shared that demand remains healthy and as a result, the company expects sequential postpaid phone net add growth. The company expects continued fiber customer additions that reflect normal fourth quarter seasonality.
- AT&T’s connectivity toolkit includes multiple technologies, including 5G, fiber and the company’s fixed wireless access product – AT&T Internet Air – which is now available in parts of 34 markets. Stankey shared the company continues to take a measured approach with consumer fixed wireless access offerings and views the service as an attractive connectivity option for businesses nationwide.
AT&T is investing in the future of America’s connectivity.
- AT&T is focused on becoming America’s best connectivity provider and remains on track with all of its 5G and fiber network expansion commitments. AT&T mid-band 5G spectrum is now available nationwide, covering more than 200 million people – another step to expand the most reliable 5G network2.
The webcast of Stankey’s conversation is available for replay at AT&T Investor Relations.