AT&T CEO Discusses Solid Fiber Growth and Market Trends
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AT&T's Performance Update by CEO John Stankey
AT&T Inc. (NYSE: T) shares are experiencing a slight decline in premarket trading, as reported by the company’s CEO, John Stankey. He noted that while trends in the wireless industry are normalizing, the company is satisfied with the performance of its Mobility division in the recent quarter.
Stankey highlighted that fiber penetration is exceeding initial expectations. Although the company is currently facing some work stoppages that could affect fiber installations, these interruptions are not anticipated to significantly alter the company's financial outcomes for the third quarter.
Future Projections and Financial Outlook
Looking ahead, AT&T projects capital investments for 2024 to range between $21 billion and $22 billion. These investments are essential to advance its 5G and fiber initiatives. Additionally, the company aims to achieve more than $2 billion in run-rate cost savings by mid-2026 and is on track for a net-debt-to-adjusted EBITDA ratio of approximately 2.5x by the first half of 2025.
Another crucial aspect of AT&T's strategy is to cultivate sustainable and regular free cash flow, simultaneously addressing short-term financing obligations.
Annual Financial Guidance Reiteration
AT&T continues to maintain its financial guidance disclosed in previous reports. For the fiscal year 2024, the company expects wireless service revenue growth in the 3% range, broadband revenue growth upward of 7%, and adjusted earnings per share (EPS) between $2.15 and $2.25, surpassing the $2.20 consensus.
Expectations also include an adjusted EBITDA growth in the range of 3% alongside a full-year projected free cash flow of about $17 billion to $18 billion.
Investment Opportunities
For investors looking to gain exposure to AT&T's performance, options include the iShares MSCI USA Value Factor ETF (BATS: VLUE) and the ETC 6 Meridian Mega Cap Equity ETF (NYSE: SIXA). These investment vehicles offer a way to participate in AT&T's future prospects while diversifying portfolios.
Latest Developments and Market Trends
In recent news, AT&T is also addressing operational challenges, including a previously reported software glitch that disrupted its wireless services across multiple cities. The firm has successfully resolved these issues, reinforcing its commitment to providing reliable service.
As for stock market reactions, AT&T shares saw a minor dip of 0.28%, closing at $21.65 during the last premarket check.
Frequently Asked Questions
What recent comments did AT&T CEO make about the company's strategy?
CEO John Stankey indicated that AT&T is experiencing stable trends within the wireless industry while planning significant investments in fiber and 5G developments.
What are the projected capital investments for AT&T in 2024?
AT&T seeks to invest between $21 billion and $22 billion in 2024 to further its fiber and 5G initiatives.
How does AT&T plan to achieve cost savings?
The company aims to reach over $2 billion in run-rate cost savings by 2026 while working to improve overall financial efficiency.
What is AT&T's expected revenue growth for 2024?
AT&T expects wireless service revenue to grow by around 3% and broadband revenue growth of over 7% for the fiscal year 2024.
Where can investors find more information about AT&T?
Investors can explore options like the iShares MSCI USA Value Factor ETF and the ETC 6 Meridian Mega Cap Equity ETF to gain exposure to AT&T's market performance.
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