AT&T reported solid wireless results in the second quarter, including postpaid phone gains, continued strong prepaid phone growth and stable postpaid churn. On a GAAP basis, service revenue declined; however, on a comparable basis service revenue grew. Consolidated revenue totaled $39.0 billion versus $39.8 billion in the year-ago.
Declines in domestic video and legacy wireline services were offset by adding approximately $1.1 billion from Time Warner net of eliminations and growth in wireless, strategic business services and advertising. On a comparative basis, revenues were $39.9 billion, an increase of 0.2% primarily due to the second-quarter close of the Time Warner acquisition.
U.S. wireless results:
- Service revenue growth on a comparable basis
- 46,000 postpaid phone net adds with continued strong year-over-year improvement
- Continued prepaid growth with 356,000 phone net adds
- Nearly 400,000 branded smartphones added to base
- Second-quarter postpaid phone churn of 0.82%
Entertainment Group results:
- 342,000 DIRECTV NOW net adds to reach more than 1.8 million subscribers
- 80,000 total video net adds; total video customer base stable with DIRECTV NOW; AT&T WatchTV launched
- 76,000 IP broadband net adds; 23,000 total broadband net adds; more than 9 million customer locations passed with fiber
- AdWorks continues double-digit revenue growth
- Time Warner acquisition closed on June 14; full second-quarter results include:
- HBO and Turner year-over-year subscription revenue growth
- Turner ad revenues up 3%
- Record number of series in production at Warner Bros.
- 166 Primetime Emmy Awards nominations
AT&T also issued the following updated 2018 guidance:
- Raising adjusted EPS to high end of the $3.50 range
- Raising free cash flow to high end of the $21 billion range; inclusive of all deal and integration costs
- Capital Investment of approximately $25 billion; $22 billion net of expected FirstNet reimbursements and vendor financing
