TLDR
- AT&T reported Q4 earnings of 52 cents per share, beating the 46 cents estimate, with revenue reaching $33.5 billion
- Customer churn rate came in at 0.98%, better than the 1.10% forecast, showing improved retention
- The telecom company announced $8 billion in stock buybacks for 2026 and over $45 billion in total shareholder returns through 2028
- Full-year EPS guidance of $2.25 to $2.35 topped analyst expectations of $2.23 per share
- Shares rose 3% in premarket trading after initially jumping more than 6%
AT&T shares gained 3% in Wednesday premarket trading after the wireless carrier delivered fourth quarter results that exceeded Wall Street expectations. The stock initially surged over 6% before moderating.
The company posted adjusted earnings of 52 cents per share on revenue of $33.5 billion. Analysts had expected 46 cents per share on revenue of $32.9 billion. Revenue grew 3.6% year-over-year.
AT&T added 421,000 postpaid customers during the quarter, just below the roughly 440,000 estimate. Fiber subscribers increased by 283,000, surpassing the consensus of 277,028.
The churn rate provided encouraging news. AT&T’s postpaid churn hit 0.98%, beating the 1.10% forecast. This metric tracks the percentage of customers who cancel or switch providers.
Guidance Exceeds Forecasts
The Dallas-based carrier issued full-year earnings guidance between $2.25 and $2.35 per share. That beat the $2.23 analyst estimate.
AT&T expects adjusted EBITDA growth of 3% to 4% this year, accelerating to 5% by 2028. Service revenue should grow at a low-single-digit pace annually through 2028.
Free cash flow is projected at over $18 billion in 2026, more than $19 billion in 2027, and above $21 billion in 2028. Annual capital investment is planned at $23 billion to $24 billion from 2026 through 2028.
Shareholder Returns Increase
AT&T plans to buy back approximately $8 billion in stock during 2026. Total shareholder returns should exceed $45 billion between 2026 and 2028 through dividends and repurchases.
The annual dividend remains at $1.11 per share. The stock had dropped about 7% year-to-date through Tuesday’s close.
The company continues focusing on convergence by investing in spectrum and fiber. This strategy offers 5G, fiber-optic broadband, and Wi-Fi on a single platform. Currently, 42% of AT&T fiber customers also use AT&T wireless services.
Financial Performance Details
Net income reached $3.8 billion, or 53 cents per share, compared to $4 billion, or 56 cents per share, in the year-ago period.
AT&T reported results before competitors Verizon and T-Mobile. Verizon announces earnings on January 30, with T-Mobile following on February 11.
Starting with first-quarter results, AT&T will restructure its operating segments into “Advanced Connectivity,” “Legacy,” and “Latin America.”
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