DALLAS, May 22, 2023
/PRNewswire/ -- John Stankey, chief executive officer,
AT&T* Inc., (NYSE:T) spoke today at the J.P. Morgan Stanley
Technology, Media and Telecom Conference where he provided an
update to shareholders. Stankey made the following
points:
- Stankey reiterated his confidence in the company's ability to
deliver free cash flow of $16 billion
or better for full-year 2023. His confidence reflects expectations
for continued adjusted EBITDA growth of 3%+ for the year, driven by
steady operational execution and ongoing benefits from the
company's cost reduction initiatives. Similarly, Stankey said he
has high visibility into key factors that disproportionately
impacted free cash flow conversion in the first quarter, including
annual incentive compensation that is paid in the first quarter.
Two primary factors will drive improved free cash flow conversion
in the remainder of 2023. First, Stankey expects that handset
payments peaked in the first quarter and will be lower for
full-year 2023 compared to 2022. Additionally, he expects capital
investment to be broadly in line with guidance for the remainder of
2023, following a year-over-year increase in the first quarter.
- AT&T continues to prioritize adding high-quality durable
customer relationships that will drive sustainable,
profitable long-term growth. In wireless, Stankey said he expects
second-quarter postpaid net additions to be influenced by three
factors:
-
- A continued normalization of industry growth;
- Temporary impacts from competitor rate plan launches; and
- The one-time reduction of about 75,000 customers from a
government contract AT&T opted not to pursue given its
uneconomic return profile.
Absent these impacts, the company has not seen a material shift in
share across the wireless industry, including to new cable MVNO
offerings.
- The company remains on track with its network expansion
commitments and expects to deploy midband spectrum to 200 million
people by year-end 2023 and to pass 30 million+ customer and
business locations in its traditional service area with fiber by
the end of 2025. Stankey believes AT&T's position as the
largest-scale domestic fiber builder gives it an advantage in
managing costs, despite build and labor costs that have moderately
impacted the company's fiber build. In addition, AT&T is
already seeing lower maintenance and repair costs where fiber has
been deployed. The combination of better initial penetration rates
and higher ARPU levels have improved the return case on AT&T's
fiber investments. These improved returns are offsetting any
increase in deployment costs. With the recent close of the
Gigapower joint venture with BlackRock, AT&T remains committed
in its mission to bring more Americans access to super-fast,
reliable, high-capacity fiber.
*About AT&T
We help more than 100 million U.S. families, friends and
neighbors, plus nearly 2.5 million businesses, connect to greater
possibility. From the first phone call 140+ years ago to our 5G
wireless and multi-gig internet offerings today, we @ATT innovate
to improve lives. For more information about AT&T Inc.
(NYSE:T), please visit us at about.att.com. Investors can learn
more at investors.att.com.
Cautionary Language Concerning Forward-Looking
Statements
Information set forth in this news release contains financial
estimates and other forward-looking statements that are subject to
risks and uncertainties, and actual results might differ
materially. A discussion of factors that may affect future results
is contained in AT&T's filings with the Securities and Exchange
Commission. AT&T disclaims any obligation to update and revise
statements contained in this news release based on new information
or otherwise.
This news release may contain certain non-GAAP financial
measures. Reconciliations between the non-GAAP financial measures
and the GAAP financial measures are available on the company's
website at https://investors.att.com.
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SOURCE AT&T