- AT&T ranked second in the Mexico market; Telcel is the market leader
- The Tier 1 operator said it plans to focus on the U.S. market, expanding fiber and 5G services
- AT&T will report Q2 earnings on October 21
AT&T is selling off its wireless business in Mexico to Grupo Televisa and Fintech Holdings for $2 billion. The provider entered the market in 2014 with the purchase of Iusacell and then Nextel Mexico, and currently holds the second spot in market share after Telcel (América Móvil).
While AT&T Mexico has lost prepaid and reseller lines over the last year, the provider grew its postpaid market segment by 7.5 million customers to reach a total of 23.4 million mobile subscribers. Its growth was faster than that of its chief competitor, Telcel, and made for a higher-value business, noted business intelligence firm BN Americas in June.
The focus on postpaid “resulted in a smaller total subscriber footprint but significantly higher revenue quality and improved Average Revenue Per User (ARPU),” said the firm.
The improved metrics set AT&T up for an exit designed to consolidate capital into its U.S. 5G and fiber deployment. AT&T argued in a press release announcing the deal that its efforts to modernize the Mexico business are best continued by a "local operator who brings attractive assets to improve the overall customer value proposition."
“This move positions AT&T Mexico to participate in that evolution and is consistent with our long-term strategy to focus our capital allocation on opportunities for growth in the vibrant U.S. market,” said John Stankey, president and CEO for AT&T, in a statement.
Financial analyst firm BNP Paribas said that the sale is “a low multiple in-line with the prior reports, and we think there’s enough upside on the core AT&T business to maintain guidance. The upshot is that offloading the business reduces organizational complexity for AT&T and allows it to focus singularly on its domestic communications business. At the same time, because AT&T will only have domestic operations after the sale, it does simplify the AT&T equity story.”
When did AT&T enter the Mexico market?
AT&T got into the Mexico market in 2014 when it acquired the bankrupt Nextel Mexico for $1.88 billion less outstanding debt.
At the time, Fierce reported that Macquarie Capital analysts Kevin Smithen and Will Clayton said that the Nextel Mexico purchase was "one of the savviest deals" AT&T had made in years.
As part of that deal, AT&T nabbed 2.8 million postpaid and corporate subscribers with heavy U.S. cross-border activity, plus 20 MHz of nationwide 800 MHz spectrum and around 100 MHz of total nationwide spectrum.
How much did AT&T invest in the Mexican market?
Since 2014, AT&T has invested more than $10 billion in the Mexico market:
- Iusacell acquisition ($2.5 billion) – Purchased Mexico's third-largest wireless provider from Grupo Salinas.
- Nextel Mexico acquisition ($1.87–$1.9 billion) – Purchased the Mexican wireless assets of NII Holdings (Nextel) to combine infrastructure networks.
- High-speed mobile internet expansion ($3 billion) – Rolled out high-speed 4G LTE coverage across Mexico
- "North American Mobile Service" integration – Invested heavily in linking its U.S. and Mexican networks to create a unified cross-border coverage footprint spanning 400 million consumers.
- 5G trials and deployment – Secured spectrum (2.5 GHz and 3.5 GHz bands) and executed early trial deployments for 5G New Radio (NR) infrastructure in major metropolitan hubs.
- Network modernization legacy shutdowns – Financed the structural decommissioning of outdated technologies: CDMA (2016), Nextel's legacy iDEN network (2017) and GSM (2019).
Despite these investments over a decade, BNP Parabas said, “The unit probably produces around $500m of cash annually, which will be a headwind to the 2027 guide calling for at least $19bn of free cash flow. This would be partially offset by savings on interest (assuming the cash is used to pay down debt), but the net result is still a loss in the neighborhood of $400m.”
Where does AT&T rank in the Mexican market?
AT&T currently ranks second in the Mexican market after Telcel (América Móvil) but ahead of Movistar, which was owned by Telefonica until April when the Spanish operator sold Movistar for $450 million to Melisa Acquisition LLC – a consortium formed by telecom platform-as-a-service specialist Oxio and Newfoundland Capital Management.
Telecompaper reported in April that Mexico registered a total of 144.59 million active mobile lines at the end of the third quarter of 2025, according to the Telecommunications Regulatory Commission (CRT). América Móvil's Telcel had a 57.9 share followed by AT&T with 16.4%, Movistar with 14.1% and Bait (Walmart) with 7%.
What happens next with the AT&T Mexico sale?
AT&T expects the sale will close in the first quarter of 2027. The company stated that the deal is in line with the strategy it outlined at its 2024 Analyst & Investor Day: “It sharpens our focus on U.S. fiber and wireless connectivity, reduces complexity, and allows us to allocate capital to areas with the highest returns and strongest long-term growth potential.”
AT&T will report its Q3 earnings on October 21, 2026.
The operator's focus on deploying fiber to the U.S. market is already taking shape. On Oct. 2, it joined together its two fiber joint ventures — Forged Fiber 37 and Gigapower — under one wholesale open access company and brought in two investment firms — Global Infrastructure Partners and CPP Investments — to form a new fiber JV which aims to reach 30 million locations with fiber broadband by 2030.
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