AT&T adds wireless subs, grows mobile revenue in Q4

AT&T said it added 229,000 net postpaid phone connections in the fourth quarter and grew wireless service revenue by nearly 2%, as the carrier works to deliver on its three-year financial targets.

 AT&T added 135,000 total postpaid connections, boosted by gains in wearables and phones that more than offset 325,000 losses in postpaid tablets. Postpaid paid phone churn was up to 1.07%, compared to 1% in the fourth quarter of 2018 and total postpaid churn was 1.29%

AT&T lost 20,000 net prepaid phone customers in Q4, which it said as largely due to competitors’ promotions.

Overall AT&T added 3.6 million net mobile connections, for a total of 165.9 million in service. For the full year AT&T added 483,000 postpaid and 506,000 prepaid phone subscribers.

“We delivered what we promised in 2019 and we begin this year with strong momentum in wireless, with HBO Max set to launch in May and our share retirement plan well underway,” said Randall Stephenson, AT&T chairman and CEO, in a statement. “Our 2020 outlook positions us to deliver meaningful progress on our 3-year financial and capital allocation plans as we continue to invest in growth opportunities and create value for our owners, as we did last year.”

Wireless service revenue in Q4 climbed to $13.94 billion, up 1.8% or $248 million from the fourth quarter 2018.  AT&T attributed the increase to gains in prepaid and higher average revenue per user (ARPU) for postpaid phone subscribers, which increased 0.4% year over year to $55.52.

Equipment revenues were down 2.1% year over year to $4.8 billion, as AT&T said it continued to experience low upgrade rates for postpaid phones. The Q4 postpaid upgrade rate of 4.8% was down slightly from 5% in the year ago period, but up 0.8% from the third quarter.  

Overall, AT&T’s mobility segment reported $18.7 billion in revenues, up 0.8% year over year, and adjusted EBITDA of $7.5 billion.

Declines in AT&T’s domestic video and legacy wireline services within its Entertainment and Business Wireline Groups, partially offset by its wireless gains, contributed to total Communications Group revenues of $36.5 billion, which were down 1.9% year over year.

Consolidated revenues totaled $46.8 billion, $48 billion excluding investment in the upcoming HBO Max service, and adjusted EBITDA was $14.4 billion.

The carrier said it achieved its 2019 goals, including reducing debt by $20.3 billion for the full year, growing earnings per share (EPS) by 1.4% and generating free cash flow of $29 billion versus its original goal of $26 billion.