AT&T reported stronger U-verse broadband and TV subscriber growth for Q2 versus the year-earlier quarter. The company now expects postpaid wireless net adds of approximately 500,000, thanks to several successful promotions in the quarter which are driving strong sales, higher gross adds and smartphone upgrade rates similar to the first quarter.
AT&T now expects second-quarter wireless EBITDA margins to be comparable to the first-quarter. Additionally, given strong consolidated customer additions and investments in new growth opportunities, consolidated margins are expected to be down year-over-year. Full-year 2013 guidance remains unchanged from January. The company continues to expect full-year revenue growth exceeding 2 percent.
AT&T also reported a strengthened cash position, with strong free cash flow and an additional $1 billion in cash proceeds from a YP Holdings LLC distribution (~$500 million) where AT&T continues to hold a minority stake, and from the sale of America Movil (AMX) shares (~$550 million). AT&T’s ownership stake in AMX continues to be in the 9 percent range.
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