AT&T Inc. shares slipped in premarket trading after the telecom giant reaffirmed its full-year earnings forecast, which came in slightly below Wall Street expectations. The company maintained its adjusted earnings projection of $1.97 to $2.07 per share, while analysts were anticipating $2.09. The minor earnings miss overshadowed a robust performance in wireless subscriber growth during the second quarter.
Despite the disappointment, AT&T added 401,000 mobile phone subscribers, significantly beating estimates of 301,000. The company’s “customer guarantee” initiative—launched in January and focused on improved reliability and better smartphone deals—has played a key role in boosting subscriber numbers. In contrast, competitor Verizon Communications reported subscriber losses in the same period.
Investors, however, had higher expectations after Verizon raised its full-year guidance earlier this week, leveraging benefits from President Trump’s tax and spending bill. That move pushed Verizon shares up 4%, while AT&T stock dropped 3.7% before market open, after closing Tuesday at $27.42. Still, AT&T has gained 20% year-to-date, outpacing the broader S&P 500 Index and its telecom peers.
Solid Q2 Performance Amid Soft Guidance
Financially, AT&T posted adjusted earnings of 54 cents per share, ahead of the expected 52 cents. Revenue rose 3.4% to $30.8 billion, beating projections of $30.4 billion. The company also reported $4.4 billion in free cash flow.
On the broadband front, AT&T’s “Internet Air” 5G fixed-wireless service added 203,000 subscribers, surpassing estimates of 169,000. Additionally, it gained 243,000 fiber-optic customers, further validating its strategy to grow both wireless and wired networks.
Fiber Rollout Accelerates with Tax Savings
Looking ahead, AT&T is doubling down on network expansion. Backed by projected cash tax savings of $6.5 billion to $8 billion through 2027, the company plans to invest $3.5 billion in its nationwide fiber-optic rollout, targeting 4 million locations annually through 2026. This effort includes the pending acquisition of Lumen Technologies’ consumer fiber unit. The company aims to reach 60 million U.S. households by 2030, with potential to expand to 70 million.
AT&T also raised its guidance for mobile-service revenue and profit while narrowing its fiber revenue outlook. It plans to repurchase $4 billion in shares this year, with $1.3 billion completed so far.
As the second of the Big Three U.S. telecoms to release Q2 results, AT&T’s performance sets the stage for T-Mobile’s earnings, expected later today.
