Goldman Sachs analyst James Schneider maintained a Buy rating on AT&T Inc (NYSE:T) with a price target of $28.
Schneider expects the stock to trade modestly higher following in-line results in light of a solid quarter with strong underlying subscriber metrics.
The analyst noted expectations were modestly elevated given investor positioning but sees fundamentals as de-risked mainly as the company has already provided 2025-27 guidance.
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Investors are concentrated on the broadband market, and any comment on the call regarding the pace of fiber additions, broadband pricing forecast, or changes in the pace of FWA additions could be incremental for the wireless and cable stocks.
AT&T reported revenue of $32.3 billion, which was in line with Schneider’s estimate of $32.2 billion and the Street’s estimate of $32.1 billion. Adjusted EBITDA of $10.79 billion was just below Schneider’s estimate of $10.94 billion and the Street’s estimate of $10.83 billion. Free cash flow of $4.83 billion was just above Schneider’s estimate of $4.7 billion and the Street’s estimate of $4.8 billion.
Wireless service revenue of $16.56 billion was just below Schneider’s estimate of $16.7 billion but in line with the Street’s at $16.53 billion. Postpaid phone net adds came in at +482k, well above Schneider’s estimate of +446k, and the Street’s at +425k. Wireless EBITDA of $8.89 billion was in line with Schneider’s estimate of $8.95 billion and the Street’s at $8.87 billion.
Business wireline service revenue of $4.38 billion was above Schneider’s estimate of $4.34 billion and the Street’s estimate of $4.30 billion. In comparison, EBITDA of $1.20 billion was below Schneider’s estimate of $1.26 billion and the Street’s estimate of $1.23 billion.
Consumer Wireline revenue of $3.47 billion was in line with Schneider’s estimate of $3.48 billion and the Street’s estimate of $3.47 billion.
Broadband revenue was $2.91 billion, versus Schneider’s estimate of $2.91 billion and the Street’s estimate of $2.90 billion. Consumer Wireline EBITDA was $1.22 billion, well above Schneider’s estimate of $1.14 billion and the Street’s estimate of $1.16 billion.
Fiber net additions of +307k were well above Schneider’s estimate at +245k and the Street at +259k, while Internet Air net additions of +158k were above GS’s estimate at +130k and the Street at +134k.
AT&T reiterated its guidance for 2025. Wireless service revenue growth stands at the higher end of 2%-3%, versus Schneider and Street’s estimate of +2.7%. Fiber broadband revenue growth stands at mid-teens versus Schneider’s +15.5% and the Street at +16.0%. Adjusted EBITDA growth stands at 3.0% or better versus Schneider’s at +3.1% and the Street at +2.7%.