Telecommunications giant AT&T (T 2.49%) reported fiscal 2025 first quarter earnings on Wednesday, April 23, that matched or exceeded analysts' consensus expectations. Revenue of $30.63 billion came in ahead of the forecasted $30.36 billion and rose 2% year over year. Adjusted earnings per share (EPS) reached $0.51, aligning with market expectations.
The first quarter showcased AT&T's focus on enhancing its 5G and fiber optic services, contributing to a solid quarter despite ongoing market challenges in segments such as its Business Wireline segment.
| Metric | Q1 2025 | Analysts' Estimate | Q1 2024 | Change (YOY) |
|---|---|---|---|---|
| Adjusted EPS | $0.51 | $0.51 | $0.54 | 6.3% |
| Revenue | $30.63 billion | $30.36 billion | $30 billion | 2% |
| Net income | $4.7 billion | N/A | $3.8 billion | 23.7% |
| Free cash flow | $3.1 billion | N/A | $2.8 billion | 10.7% |
Source: AT&T. Note: Analysts' consensus estimates for the quarter provided by FactSet. YOY = Year over year.
AT&T, a major player in the global telecommunications industry, focuses on offering wireless telecommunication, digital entertainment, and broadband services. It is focused on expanding its 5G network, essential for competing in the data-heavy and ever-evolving telecommunications sector. Additionally, AT&T is investing heavily in its fiber optic network to deliver high-speed internet services, addressing the increasing demand for faster and more reliable broadband connectivity.
AT&T's strategic priorities are centered around solidifying its market position through technological advancements and operational efficiency improvements to help improve its fiscal health through debt reduction.
AT&T's business saw notable developments across its 5G and fiber optic networks in Q1. The company added 324,000 postpaid phone net additions. Analysts were expecting 255,000 additions. Mobility service revenue rose 4.1% year over year.
Fiber optic network growth propelled consumer broadband revenue upward by 19% to reach $2.1 billion, marking the ongoing strategic significance of fiber services within AT&T's offerings. There were 261,000 AT&T Fiber net additions, marking 21 consecutive quarters now of net adds exceeding 200,000 in a period. The Consumer Wireline segment reported a 5.1% increase in revenue year over year, primarily driven by broadband and fiber expansion.
The Business Wireline segment continues to see a secular decline in legacy services, with revenue down 9.1% year over year. This trend highlights AT&T's ongoing efforts to migrate away from older copper networks towards modern fiber-optic and wireless alternatives.
Diversifying and fortifying its spectrum assets continued to be AT&T's focus, aligned with its competitive positioning. The anticipated mid-2025 sale of its 70% stake in DirecTV to private equity firm TPG underscores the company's long-term objective to concentrate on core competencies while streamlining operations.
For the rest of 2025, AT&T management affirmed its outlook, targeting low single-digit growth in consolidated service revenue. alongside an anticipated increase in mobility service revenue toward the higher end of 2% to 3% for the full year. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) are expected to grow by 3% or more for the full year, underlining AT&T's strategic vision for continuous operational focus on expanding both fiber and 5G capabilities.
Investors should monitor AT&T's progress in phased technological transitions, especially in wireline services. Anticipated share repurchases in Q2 2025 may reflect the company's strategic resource reallocation to bolster shareholder value as it navigates the evolving telecommunication landscape.
Revenue and net income are presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
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