Group 1 - AT&T Inc. reported better-than-expected earnings for the second fiscal quarter, surpassing both bottom and top line expectations [1] - The strong performance was driven by significant growth in the company's core broadband operations [1] - AT&T added 243 thousand new subscribers to its broadband service during the quarter [1]

Group 1 - AT&T has been the best-performing stock among the three major US telecommunications companies since the rollout of its 3-year plan in December 2024 [1] - The author has a long-term investment strategy focused on matching S&P 500 returns with lower volatility and higher income [1] - The investment approach emphasizes buying when prices are low relative to intrinsic value, regardless of asset class, market cap, sector, or yield [1] Group 2 - The article expresses the author's personal opinions and does not involve compensation from any company mentioned [2] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not reflect the platform's overall stance [3]

AT&T beat second-quarter financial estimates on Wednesday morning, as it added more phone but fewer internet subscribers than analysts had forecast. https://t.co/hDAalcgnv1 ...

Core Viewpoint - The communication services sector, including AT&T, is performing strongly in 2025, with AT&T's stock rising over 19% and the sector gaining 11.41% compared to the S&P 500's 7.28% gain [1][2]. Financial Performance - AT&T reported Q2 EPS of 54 cents, exceeding the consensus estimate of 51 cents, resulting in a trailing 12-month P/E ratio of 16.79 [2]. - The company expects earnings to grow by 6.07% next year, from an annualized $2.14 per share to $2.27 per share, with a forward P/E ratio of 13.30, indicating a 20.78% improvement [3]. - Q2 revenues were $30.8 billion, up from $29.8 billion in Q2 2024, with net income of $4.9 billion compared to $3.9 billion in the same period [4]. Business Segments - Mobility service revenues increased by 3.5% year-over-year to $16.9 billion, while consumer fiber broadband revenues rose by 18.9% year-over-year to $2.1 billion [4][5]. - The company added 401,000 postpaid phone subscribers, 243,000 AT&T Fiber subscribers, and 203,000 AT&T Internet Air subscribers in Q2 [5]. Shareholder Returns - AT&T repurchased approximately $1 billion of its common shares as part of a $10 billion share repurchase authorization [5]. - The company maintains a dividend yield of 4.06%, with an annual dividend of $1.11 per share and a payout ratio of 68.10% [7]. Market Position and Competition - AT&T is the third-largest wireless provider in the U.S., with a communications infrastructure reaching 290 million people across approximately 24,000 cities and towns [10]. - The company has invested over $145 billion in network buildout since 2019, enhancing its competitive position against rivals like T-Mobile and Verizon [10][9]. Analyst Ratings and Price Target - Analysts have a consensus Moderate Buy rating for AT&T, with 18 out of 25 analysts assigning a Buy rating and an average price target of $29.17, indicating a potential upside of 6.04% [11].

Core Insights - AT&T Inc. reported strong second-quarter 2025 results with adjusted earnings and revenues exceeding Zacks Consensus Estimates [1][8] Financial Performance - Net income on a GAAP basis was $4.46 billion or 62 cents per share, up from $3.55 billion or 49 cents per share in the same quarter last year, primarily due to higher contributions from DIRECTV investments [3] - Quarterly GAAP operating revenues increased by 3.5% year over year to $30.85 billion, driven by higher Mobility service and equipment sales, as well as Consumer Wireline revenues [4] - Adjusted operating income rose to $6.49 billion from $6.28 billion, with adjusted operating income margins at 21% [4] - Adjusted EBITDA improved to $11.73 billion from $11.34 billion [4] Subscriber Growth - AT&T added 479,000 post-paid subscribers, including 401,000 postpaid wireless phone additions, with a postpaid churn rate of 1.02% [5] - Postpaid phone-only average revenue per user (ARPU) increased by 1.1% year over year to $57.04 [5] Segment Performance - Communications segment operating revenues were $29.7 billion, up from $28.58 billion, with Mobility business revenues increasing by 6.7% to $21.84 billion [6] - Service revenues from the Mobility unit improved by 3.5% to $16.85 billion, while equipment revenues rose by 18.8% year over year to $4.99 billion [7] - Revenues from the Consumer Wireline business increased due to fiber broadband gains, with net fiber additions of 243,000 [7] Cash Flow and Liquidity - For the first six months of 2025, AT&T generated $18.81 billion in cash from operations, compared to $16.64 billion a year ago [10] - Free cash flow for the quarter was $4.39 billion, up from $3.95 billion in the previous year [10] - As of June 30, 2025, AT&T had $10.5 billion in cash and cash equivalents, with long-term debt of $123.06 billion [10] Future Guidance - AT&T expects wireless service revenues to improve by 3% or more in 2025, with broadband revenues anticipated to grow in the mid to high-teens [11] - Adjusted earnings are projected to be between $1.97 and $2.07 per share, with free cash flow expected to exceed $16 billion [12]

Group 1 - The core focus of Quad 7 Capital is to provide investment opportunities through their BAD BEAT Investing platform, emphasizing both long and short trades with a proven track record of success [1] - The team consists of 7 analysts with diverse expertise in business, policy, economics, mathematics, game theory, and sciences, allowing for comprehensive market analysis [1] - Since May 2020, the company has maintained an average position of 95% long and 5% short, showcasing their strategic investment approach [1] Group 2 - BAD BEAT Investing offers various benefits, including weekly well-researched trade ideas, access to multiple chat rooms, and daily summaries of key analyst upgrades and downgrades [2] - The platform also provides educational resources for learning basic options trading and extensive trading tools to enhance investor proficiency [2] - The goal of BAD BEAT Investing is to save time for investors by delivering high-quality research with clear entry and exit targets [1][2]

Core Insights - AT&T reported revenue of $30.85 billion for the quarter ended June 2025, reflecting a 3.5% increase year-over-year, and an EPS of $0.54, down from $0.57 in the same quarter last year [1] - The revenue exceeded the Zacks Consensus Estimate of $30.53 billion by 1.02%, while the EPS surpassed the consensus estimate of $0.51 by 5.88% [1] Financial Performance Metrics - AT&T's shares have returned -3% over the past month, contrasting with the Zacks S&P 500 composite's +5.9% change, indicating underperformance relative to the broader market [3] - The company holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the market in the near term [3] Consumer Wireline Performance - Fiber Broadband Connections reached 9.84 million, slightly above the average estimate of 9.83 million [4] - Fiber Broadband Net Additions were 243 thousand, exceeding the average estimate of 239.75 thousand [4] - Non-Fiber Broadband Connections totaled 4.43 million, surpassing the average estimate of 4.36 million [4] - Non-Fiber Broadband Net Additions were -93 thousand, better than the estimated -157.3 thousand [4] Revenue Breakdown - Business Wireline revenues were $4.31 billion, slightly below the average estimate of $4.33 billion, representing a year-over-year decline of 9.3% [4] - Consumer Wireline revenues were $3.54 billion, slightly above the estimate of $3.53 billion, reflecting a 5.8% increase year-over-year [4] - Corporate and Other revenues were $94 million, significantly exceeding the average estimate of $20.56 million, but down 16.1% year-over-year [4] - Mobility revenues reached $21.85 billion, above the estimate of $21.54 billion, marking a 6.7% increase year-over-year [4] - Total Communications revenues were $29.7 billion, exceeding the estimate of $29.4 billion, with a year-over-year increase of 3.9% [4] - Latin America revenues were $1.05 billion, below the estimate of $1.09 billion, reflecting a 4.4% decline year-over-year [4] - Latin America Wireless equipment revenues were $392 million, slightly below the estimate of $396.12 million, down 3% year-over-year [4] - Latin America Wireless service revenues were $662 million, below the estimate of $685.89 million, representing a 5.3% year-over-year decline [4]

Subscriber Growth - AT&T gained wireless subscribers [1] - AT&T gained internet subscribers [1] Investment Plans - AT&T announced plans to further invest in fiber-cable build-out [1]

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or ...

Financial Data and Key Metrics Changes - Total revenues and adjusted EBITDA each grew by 3.5% year over year during the second quarter [16] - Adjusted EPS was $0.54, up approximately 6% from $0.51 the prior year [16] - Second quarter free cash flow was $4.4 billion, an increase from $4.0 billion the prior year [16] - Capital investment was $5.1 billion, showing modest year-over-year growth [16] Business Line Data and Key Metrics Changes - Mobility service revenue grew by 3.5% with EBITDA growth of 3.2% year over year [18] - The company added 401,000 postpaid phone customers in the second quarter, exceeding expectations [18] - Consumer Wireline revenue grew by 5.8% year over year, driven by approximately 19% growth in fiber revenue [22] - Fiber customer additions were 243,000 in the second quarter, with a convergence rate of 40.9% for fiber and 5G services [23] Market Data and Key Metrics Changes - The company added 243,000 fiber subscribers and over 200,000 Internet Air subscribers, marking a significant increase in broadband service adoption [7][24] - The mobility subscriber growth is increasingly driven by customers taking both wireless and broadband services [19] - The company expects higher Internet Air net additions in the second half of the year compared to the first half [24] Company Strategy and Development Direction - The company aims to invest in next-generation networks, planning to accelerate fiber deployment to 4 million new locations per year by the end of 2026 [10] - The strategy focuses on becoming the best connectivity provider in America, emphasizing customer-first initiatives and advanced technology investments [4][5] - The company is transitioning away from legacy copper infrastructure, with plans to discontinue service across approximately 10% of wire centers [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year consolidated financial guidance for 2025, citing steady growth in service revenues and free cash flow [5] - The operating environment is expected to remain competitive, with management planning for a more active second half of the year [40][72] - Management highlighted strong policy tailwinds for investment, noting unprecedented support for organic growth in the telecommunications sector [88] Other Important Information - The company plans to contribute $1.5 billion to its pension plan by the end of next year, enhancing the plan's funded status [12] - The company expects to realize between $6.5 billion and $8 billion in cash tax savings from 2025 through 2027 due to recent tax legislation [31] - The company is evaluating options for allocating capital, including strategic investments and share repurchases [34] Q&A Session Summary Question: Wireless churn and its impact - Management acknowledged the 17 basis point increase in phone churn and discussed expectations for a competitive environment in the second half of the year [38][40] Question: Pricing strategy and spectrum acquisitions - Management indicated that pricing is not the primary issue affecting churn and discussed the potential for spectrum acquisitions in the future [46][51] Question: Fiber build returns and mobility customer quality - Management expressed confidence in the profitability of new fiber builds and the quality of incremental mobility customers, emphasizing the importance of converged services [58][64] Question: EBITDA growth guidance and cost efficiencies - Management noted that while growth-related spending is expected to be lumpy, they anticipate continued operating leverage and margin performance in mobility [70][87] Question: Consumer wireline subscriber expectations - Management expects typical seasonality in fiber net additions and noted strong performance against cable competitors [78][80]