(Reuters) – AT&T on Monday beat expectations for fourth-quarter wireless subscriber growth, driven by strong demand for its discounted premium plans that combine 5G mobile and high-speed fiber optic data services.
The company’s shares rose about 2% in premarket trading.
The U.S. telecom giant added a net 482,000 monthly paid wireless phone subscribers during the holiday quarter, beating analysts’ expectations for a gain of 424,550, according to data from Visible Alpha.
AT&T’s strategy of bundling high-speed fiber optic networks with wireless phone service has helped fuel the company’s growth as its base of potential new wireless customers shrinks in the United States.
Its optical fiber business added 307,000 new customers in the fourth quarter, which was higher than the 226,000 new customers in the previous quarter, setting a record for the best increase in optical fiber network in the fourth quarter.
The final three months of the year are typically strong for telecoms players, driven by factors such as Black Friday sales, trade-in deals for new iPhone releases and the gift-giving season around Christmas, all of which help boost subscriber numbers.
Rival Verizon on Friday reported its best quarterly wireless subscriber growth in five years, adding 568,000 monthly paid wireless subscribers in the fourth quarter.
AT&T expects adjusted profit in the range of $1.97 to $2.07 per share, excluding contributions from its 70% stake in DirecTV, which it sold for $7.6 billion. It’s unclear whether that range is comparable to estimates of $2.18 per share, according to data compiled by London Stock Exchange Group (LSEG).
AT&T said last month it expects free cash flow to exceed $18 billion in 2027 and that fiber will reach more than 50 million locations by 2029.
Excluding other items, the company reported profit of 54 cents per share, above analysts’ expectations of 50 cents per share, according to data compiled by London Stock Exchange Group (LSEG).
Total revenue grew about 1% to $32.3 billion, compared with expectations of $32.04 billion.
AT&T began offering airtime credit for network outages starting Jan. 9, part of a new effort to attract customers in a competitive market.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Pooja Desai)
