AT&T Lifts Profit Outlook on Continued Postpaid Phone, Internet Growth

By Kelly Cloonan

AT&T boosted its full-year profit outlook after adding further subscribers for its postpaid phone service in the third quarter.

The telecommunications company also added a record number of total consumer and business customers for its internet service in the quarter. The customer gains helped AT&T's quarterly adjusted earnings per share and revenue top Wall Street's estimates.

"We are growing valuable customer relationships as more homes and businesses choose AT&T for all their advanced connectivity needs across both internet and on-the-go wireless," Chief Executive John Stankey said.

For the full year, AT&T now expects adjusted earnings per share of about $2.40, compared with a prior forecast of $2.25 to $2.35. Analysts polled by FactSet project $2.34.

The company also backed its capital investments outlook of $23 billion to $24 billion for the year, but now expects that figure to come down in the longer term, guiding for a range of $22 billion to $23 billion annually in 2027 and 2028.

Stankey added that the company is well-positioned for the rise of artificial intelligence given its leadership in fiber.

Third-quarter earnings from continuing operations were 13 cents a share, compared with $1.29 a share a year earlier. The figure from the recent quarter was dented by a non-cash impairment charge tied to the company's Mexico wireless business it plans to sell, as well as employee separation charges, while the year-ago figure includes a gain recognized from its sale of a stake in DirecTV.

Adjusted earnings per share were 65 cents, above analyst estimates of 60 cents, according to FactSet.

Revenue rose 5.3% to $32.3 billion, topping analyst estimates of $31.69 billion.

Sales in the company's advanced connectivity segment, which makes up the bulk of its topline, increased 7.2% to $29.48 billion. AT&T pointed to a boost from growth in retail wireless subscribers in underpenetrated categories and converged accounts, as well as higher prices that were partially offset by discounts.

Legacy sales slid 25% to $1.52 billion due to lower demand as the company continues to decommission its copper-based network.

Latin America revenue, meanwhile, rose 13% to $1.24 billion. AT&T last week said it has reached a deal to sell its Mexico wireless business, which comprises the entirety of its Latin America segment, to Grupo Televisa and Fintech Holdings. Under the deal, AT&T will receive $2 billion in cash at closing.

AT&T added 379,000 net subscribers for its postpaid phone service in the quarter, compared with analysts' estimate of about 379,300. Postpaid phone churn was 0.9%.

The company also added 769,000 total consumer and business customers for its internet service, marking a record quarter, including 442,000 for its fiber-optic network and 327,000 for fixed wireless.

The results come as SpaceX emerges as a potential competitor to the leading wireless carriers. The Elon Musk-led company made its biggest move yet into the wireless market last month, signing an $8 billion deal to buy cellular spectrum licenses from investment firm Grain Management. SpaceX has said it wants to move its Starlink satellite service beyond broadband, and the spectrum acquisition could make it a more serious threat to AT&T, Verizon and T-Mobile.

Write to Kelly Cloonan at kelly.cloonan@wsj.com

(END) Dow Jones Newswires

October 21, 2026 06:45 ET (10:45 GMT)