AT&T misses revenue expectations in Q3
AT&T on Tuesday reported its third quarter financial results that fell slightly below market expectations. Still, the telco maintained its guidance for the full fiscal year.
The company reported adjusted earnings of 74 cents per share on revenue of $39.7 billion. A year prior, the company reported 74 cents per share on revenue of $40.89 billion.
Wall Street was expecting earnings of 75 cents per share on revenue of $40.1 billion.
Revenues were down on a year-over-year basis primarily due to declines in legacy wireline services and consumer mobility, the company said. Excluding the impact of hurricanes and earthquakes in the third quarter, revenues would have been $39.8 billion.
Operating expenses for the quarter were $33.3 billion, compared with $34.5 billion a year prior.
"We continued to operate our business efficiently in the quarter," CEO Randall Stephenson said in a statement. "At a time of transformation in our wireless and video businesses, as well as investment in growth opportunities, we're able to maintain our full-year guidance. Wireless margins and phone churn continue to run at record levels, our fiber deployment is helping drive broadband growth and DIRECTV NOW had another strong quarter."
The company had a total of 3 million wireless net adds for Q3, with 2.3 million coming from the US and nearly 700,000 from Mexico. Postpaid phone churn came to 0.84 percent for the quarter, which AT&T attributed to "the success of video and wireless bundling strategy."
In its entertainment segment, AT&T posted 125,000 IP broadband net adds and 29,000 total broadband net adds. It added on net nearly 300,000 DIRECTV NOW subscribers -- not quite making up for its traditional TV subscriber decline. Earlier in the month, AT&T revealed in an SEC filing that it lost around 390,000 traditional video subscribers in Q3.
Meanwhile, AT&T said Monday that it has delayed the termination date for its Time Warner deal, which is still expected to close by the end of the year. The merger is still awaiting approval from the US Department of Justice.