AT&T Q1 mixed amid COVID-19, plans more 5G investment as network traffic surges

ATT said it is seeing unprecedented volumes on its network due to the COVID-19 pandemic as it reported mixed first quarter results. 

The telecom and media company reported first quarter earnings and revenue that fell short of expectations, withdrew its outlook due to COVID-19 and said it had enough cash flow to invest in growth areas such as 5G.

ATT reported adjusted first quarter earnings of 84 cents a share on revenue of $42.8 billion, down from $44.8 billion a year ago. Wall Street was expecting ATT to report adjusted first quarter earnings of 85 cents a share on revenue of $44.2 billion. ATT’s net earnings in the first quarter were $4.6 billion, or 63 cents a share. 

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ATT said that COVID-19 had a $433 million impact on its EBITDA and shaved 5 cents a share from its results in the quarter. The telecom and media company said it took a hit due to lower wireless equipment sales and lower sports-related advertising largely due to the cancellation of the 2020 NCAA Division 1 Men’s Basketball Tournament.

Wireless service revenue showed growth, but video, theatrical and legacy service revenue fell.

In wireless, ATT said service revenue was up 2.5% with a postpaid phone churn of 0.86%. ATT added 163,000 postpaid net phone additions. In entertainment, ATT said it finished the quarter with 18.6 million premium TV subscribers with 897,000 net losses. The company added 209,000 ATT Fiber connections.

CEO Randall Stephenson said that ATT’s cash position and cash flow will enable it to adjust capital allocation plans and invest in 5G, broadband and HBO Max and pay down debt. 

Article source: https://www.zdnet.com/article/at-t-q1-mixed-amid-covid-19-plans-more-5g-investment-as-network-traffic-surges/#ftag=RSSbaffb68