AT&T results beat expectations for Q4 2024, driven by 5G and fiber
AT&T continues to focus its attention on its 5G and fiber businesses, and touted “solid momentum” in expanding its customer base of profitable subscribers to both those services.
The company’s results for the fourth quarter of 2024 beat expectations. AT&T reported consolidated revenues of $32.3 billion for the fourth quarter, with profits of $4.4 billion.
“The strong results this quarter are the result of a four-plus-year period of hard work and consistent execution by our teams, which has positioned us well for a new era of growth,” said AT&T CEO John Stankey. “We ended 2024 with strong momentum. Customers and shareholders can look forward to receiving even more value in 2025 as we expand the country’s largest fiber network, modernize our wireless network, grow our business and begin share repurchases in the second half of the year.”
Operating expenses were up slightly year-over-year, which the carrier said was due to accelerated depreciation on wireless network equipment associated with its migration to Open RAN, as well as its continued fiber and network upgrades. AT&T also said that device costs were higher.
In terms of subscriber figures, AT&T reported 482,000 postpaid phone net additions, on churn of 0.85%, and 307,000 net fiber additions for the fourth quarter of 2024. Mobility service revenues were up 3.3% compared to the fourth quarter of 2023, to $16.6 billion.
For the full year, the AT&T results reflected revenues of $122.3 compared to $122.4 billion in the year-ago quarter, driven down by lower revenues from business wireline and mobility equipment. Net income for the year was down from $15.6 billion to $12.3 billion.
Capital expenses for the year were $20.3 billion, up from $17.9 billion in 2023. AT&T reported that capex for Q4 was at $6.8 billion, compared to $4.6 billion in the year-ago quarter.
Meanwhile, broadband revenues were particularly healthy: AT&T said that its consumer broadband revenues increased 7.8% year-over-year to reach $2.9 billion in the fourth quarter of 2024.
The carrier said that it currently passes 28.9 million consumer and business locations with fiber.
At AT&T’s investor day in December, executives had emphasized several points of its strategy going forward: owner’s economics at scale, particularly when it comes to fiber; implementing multi-vendor Open RAN; and exiting legacy infrastructure.
The company plans to push from an estimated 270 million POPs covered with midband 5G at the end of 2024, to more than 300 million by the end of 2026. Meanwhile, the company will also be expanding its fiber footprint to reach 50 million locations, up from that 28.9 million at the close of 2024.
5G, Stankey emphasized in his presentation at the investor day, has provided AT&T with “improved and durable returns” since mid-2020, including both a boost in AT&T’s postpaid phone subscriber base as well as mobile service revenues. AT&T anticipates that its mobility service revenues will continue to grow by 2-3% annually in the next several years.
AT&T expects to have capital expenditures in a range of around $22 billion a year over the next few years as it works to achieve its 5G and fiber network goals, and the company also plans to execute dividends and stock buybacks totaling around $40 billion.
Meanwhile, AT&T also plans to step up its exit from legacy copper infrastructure. AT&T plans to no longer provide copper-based services in the majority of its territory by 2029, transitioning customers to its fiber where available or to its 5G Fixed Wireless Access service. It expects that most of its copper customers by population will be able to be served by its fiber footprint, with only about 10% of population (but 50% of geographic area) to be served with a FWA-first transition approach for customers.
