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AT&T (T) CEO Updates Shareholders, Expects Growth to Continue

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AT&T Inc.’s T chief executive officer, John Stankey, has provided an update to shareholders at the Goldman Sachs GS Communacopia Conference.

Stankey said that the company has restructured its asset base to position its largest entities — AT&T Communications and WarnerMedia — to better capitalize on the long-term underlying tailwinds.

After the close of the WarnerMedia-Discovery DISCA deal, AT&T Communications and Warner Bros. Discovery are likely to have the right capital structure and asset base to lead their respective industries.

AT&T’s shares have lost 3.7% in the past year compared with the industry’s decline of 3.5%.

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The telecom and media giant has started to witness early momentum in its core market areas, driven by strength in 5G, fiber, and HBO Max subscribers. However, it must continue to execute and cut additional costs to deliver on management’s long-term vision. AT&T needs to build upon its recent market momentum to improve its value proposition across all of its customer segments.

In the wireless business, AT&T’s network quality and go-to-market efforts have helped it to drive subscriber growth trends and lower churn. The company intends to continue investing to deliver 5G capabilities for new use cases to its expanding customer base.

AT&T continues to deploy fiber across its wired footprint. It is confident in its ability to reach almost 2.5 million incremental customer locations by the end of this year. Though the company has experienced some disruption in its supply chain, it maintains the long-term guidance of reaching 30 million locations by the end of 2025.

The WarnerMedia-Discovery transaction is expected to be closed in mid-2022. Until then, AT&T remains focused on expanding HBO Max’s global footprint. HBO Max was launched in 39 Latin American territories in June and is set for launch in six European countries next month. AT&T expects to reach between 70 million and 73 million HBO Max and HBO subscribers worldwide by the end of this year.

AT&T is aiming to increase efficiencies to lower operating costs, while focusing on 5G and fiber-based connectivity along with the expanded reach of software-based entertainment platforms.

The stock currently has a Zacks Rank #3 (Hold).

A better-ranked stock in the broader industry is Qualcomm, Inc. QCOM, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Qualcomm delivered a trailing four-quarter earnings surprise of 13.5%, on average.


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The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report

QUALCOMM Incorporated (QCOM) : Free Stock Analysis Report

AT&T Inc. (T) : Free Stock Analysis Report

Discovery, Inc. (DISCA) : Free Stock Analysis Report

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