AT&T reported Q2 revenues from continuing operations of $29.6 billion versus $35.7 billion in the year-ago quarter, down 17.1% reflecting the impact of the U.S. Video separation in Q3 2021 and certain other divested businesses. Excluding the impact of these divestitures, operating revenues for standalone AT&T were up 2.2%, from $29.0 billion in the year-ago quarter.
AT&T said its results were driven by higher Mobility revenues and, to a lesser extent, higher Mexico and Consumer Wireline revenues, partially offset by lower Business Wireline revenues.
“We’re expanding our customer base at an accelerated pace across our twin engines of growth – 5G and fiber,” said John Stankey, AT&T CEO. “We’re rapidly building out our best-in-class networks on the heels of record-level connectivity investment. We’ve already added nearly 2 million AT&T Fiber locations this year and just reached our target of covering 70 million people with mid-band 5G spectrum two quarters early, with expectations to now approach the 100 million mark by the end of year.”
On the investor conference call, AT&T also disclosed that more customers are falling behind in monthly payments.
Some additional highlights:
Mobility
- Revenues were up 5.2% year over year, to $19.9 billion due to higher service and equipment revenues. Service revenues were $15.0 billion, up 4.6% year over year, primarily driven by subscriber growth. Equipment revenues were $4.9 billion, up 7.2% year over year, driven by increased sales of higher priced smartphones.
- Operating expenses were $13.7 billion, up 6.1% year over year due to higher equipment costs, network costs, bad debt expense, amortization of customer acquisition costs, HBO Max content costs, FirstNet
- Total net adds were 6.6 million
- Postpaid churn was 0.93% versus 0.87% in the year-ago quarter.
- Postpaid phone churn was 0.75% versus 0.69% in the year-ago quarter.
- Postpaid phone-only ARPU was $54.81, up 1.1% versus the year-ago quarter, due to improved international roaming and a mix shift to higher-priced unlimited plans.
- FirstNet connections reached approximately 3.7 million across more than 21,800 agencies.
Business Wireline
- Revenues were $5.6 billion, down 7.6% year over year due to lower demand for legacy voice and data services, a strategic decision to deemphasize non-core services and lower revenues from the government sector.
- Operating expenses were $4.9 billion, down 2.0% year over year due to ongoing operational cost efficiencies and lower amortization of deferred fulfillment costs, partially offset by higher wholesale network access costs and higher depreciation expense.
Consumer Wireline
- Revenues were $3.2 billion, up 1.1% year over year due to gains in broadband more than offsetting declines in legacy voice and data services and other services. Broadband revenues increased 5.6% due to fiber growth of nearly 28%, partially offset by non-fiber revenue declines of 9.8%.
- Total broadband losses, excluding DSL, were 25,000, reflecting AT&T Fiber net adds of 316,000, more than offset by losses in non-fiber services. AT&T Fiber now has the ability to serve 18 million customer locations, and offers symmetrical speeds up to 5-Gigs across parts of its entire footprint of more than 100 metro areas.