Q4 2025 AT&T Inc Earnings Call

January 28, 2026

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Following the presentation, the call will be open for questions.

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I will now like to turn the conference. Call over to our host, Brett Feldman Treasurer and head of investor relations. Please go ahead.

Thank you and good morning. Welcome to our fourth quarter call. I'm Brett Feldman Treasurer and head of investor relations for AT&T.

Joining me on the call today, are John Stankey, our chairman and CEO, and Pascal, Darrow our CFO.

Speaker #1: Good morning and welcome to AT&T's fourth quarter 2025 earnings call. At this time, all participants are in a listen-only mode. Should you need assistance during the call, please press star and zero and an operator will assist you offline.

Operator: Good morning, and welcome to AT&T's Q4 2025 earnings call. At this time, all participants are in a listen-only mode. Should you need assistance during the call, please press star zero and an operator will assist you offline. Following the presentation, the call will be open for questions. If you'd like to ask a question, please press star then one, and you will be placed in the question queue. If you are in the question queue and would like to withdraw your question, you can do so by pressing star then two. As a reminder, this conference is being recorded. I would now like to turn the conference call over to our host, Brett Feldman, Treasurer and Head of Investor Relations. Please go ahead.

Speaker #1: Following the presentation, the call will be open for questions. If you would like to ask a question, please press star then one, and you will be placed in the question queue.

Q4 2025 AT&T Inc Earnings Call

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Q4 2025 AT&T Inc Earnings Call

Wednesday, January 28th, 2026 at 1:30 PM

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John Stankey: During our Analyst and Investor Day at the end of 2024, we outlined our path to become the best advanced connectivity provider in America, and I believe our team executed well against this strategy in 2025. We met or exceeded all of our consolidated full-year financial guidance, driven by another solid year of 5G and fiber subscriber growth. We reported over 1.5 million postpaid phone net adds for the fifth consecutive year and over 1 million AT&T Fiber net adds for the eighth consecutive year. We also accelerated the growth of AT&T Internet Everywhere with 875,000 net adds, which more than doubled our customer base from where we began the year. The result of this operating momentum was the best year for consumer broadband subscriber growth in a decade.

During our Analyst and Investor Day at the end of 2024, we outlined our path to become the best advanced connectivity provider in America, and I believe our team executed well against this strategy in 2025. We met or exceeded all of our consolidated full-year financial guidance, driven by another solid year of 5G and fiber subscriber growth. We reported over 1.5 million postpaid phone net adds for the fifth consecutive year and over 1 million AT&T Fiber net adds for the eighth consecutive year. We also accelerated the growth of AT&T Internet Everywhere with 875,000 net adds, which more than doubled our customer base from where we began the year. The result of this operating momentum was the best year for consumer broadband subscriber growth in a decade.

John Stankey: This strong growth is a result of over five years of executing a sustainable, investment-led business model. It centers on providing customers with all of their advanced connectivity needs from one trusted provider. We also made progress on many of our capital allocation commitments in 2025. During the first half of the year, we achieved our target of net debt to adjusted EBITDA in the 2.5 times range and commenced a share repurchase program. Overall, we returned over $12 billion to our shareholders through dividends and buybacks, which is more than a 50% increase from 2024. Our improved financial flexibility and confidence in our investment thesis also positioned us to make opportunistic strategic investments that benefit our customers and ultimately, our shareholders.

This strong growth is a result of over five years of executing a sustainable, investment-led business model. It centers on providing customers with all of their advanced connectivity needs from one trusted provider. We also made progress on many of our capital allocation commitments in 2025. During the first half of the year, we achieved our target of net debt to adjusted EBITDA in the 2.5 times range and commenced a share repurchase program. Overall, we returned over $12 billion to our shareholders through dividends and buybacks, which is more than a 50% increase from 2024. Our improved financial flexibility and confidence in our investment thesis also positioned us to make opportunistic strategic investments that benefit our customers and ultimately, our shareholders.

John Stankey: This includes our agreements to acquire spectrum licenses from EchoStar and fiber assets from Lumen, and we continue to expect both these transactions to close early this year. These transactions represent key building blocks that significantly expand the total addressable market for our advanced connectivity services in the years ahead. Our investments in 5G and fiber, both organically and through our acquisitions, have positioned us to accelerate and scale the execution of our strategy in 2026. This includes the pace of our fiber expansion. Within our traditional operating region, we continue to expect that our annual pace of fiber construction will ramp from 3 million new locations in 2025 to a run rate of 4 million by the end of this year.

John Stankey: We also expect to accelerate the availability of our fiber internet services outside of these areas, following our acquisition of Lumen's fiber assets and build capabilities, including GigaPower and the fiber assets that we're acquiring from Lumen. We expect to reach over 40 million customer locations with our fiber services by the end of this year, up from 32 million at the end of 2025. Beyond 2026, we plan to expand our fiber reach by approximately 5 million locations annually through the end of this decade. We expect this to drive rapid expansion of our opportunity to sell fiber and 5G together to both households and businesses at unmatched scale. The size and pace of our fiber deployment has positioned us to achieve these objectives with consistent execution and a high degree of capital efficiency.

We also expect to accelerate the availability of our fiber internet services outside of these areas, following our acquisition of Lumen's fiber assets and build capabilities, including GigaPower and the fiber assets that we're acquiring from Lumen. We expect to reach over 40 million customer locations with our fiber services by the end of this year, up from 32 million at the end of 2025. Beyond 2026, we plan to expand our fiber reach by approximately 5 million locations annually through the end of this decade. We expect this to drive rapid expansion of our opportunity to sell fiber and 5G together to both households and businesses at unmatched scale. The size and pace of our fiber deployment has positioned us to achieve these objectives with consistent execution and a high degree of capital efficiency.

John Stankey: Over the past 2 years, in an inflationary environment, our average deployment cost per fiber passing has increased by approximately 2% annually, and we expect a similar trend over the next 3 years. While our internet strategy will remain fiber-first, our investments in wireless network modernization and spectrum materially expand our opportunity to offer our advanced internet services over fixed wireless to the right customers in areas where we do not reach with fiber. Today, we're able to offer advanced internet services over fiber or 5G to over 90 million customer locations across the country. You can see the benefits of our scale and the improved growth of our advanced home internet connections. During each of the past 2 quarters, we've added over 500,000 combined AT&T Fiber and Internet Air customers, which is nearly 30% growth in net adds versus the second half of 2024.

John Stankey: In areas where we offer converged services, we rank number 1 in brand love and number 1 in Net Promoter Score with consumers and small businesses in both wireless and internet connectivity. We're number 1 or number 2 with medium-sized businesses and enterprises. The scores for our converged offers are not simply better than our standalone services; they're improving in most categories. It's no surprise that our converged customers remain our most valuable, with lower churn and a propensity to take higher internet speeds, attach more wireless lines, and stay with us longer. Our acquisition of Lumen fiber assets, which we expect to close in short order, is a key example of how we've positioned AT&T to materially improve share in home, internet, and wireless. We're acquiring a fiber network with only 25% customer penetration, well below AT&T Fiber penetration of 40%.

John Stankey: We estimate that fewer than 20% of these customers also subscribe to our wireless services. This is less than half of the convergence rate we've achieved in our current fiber footprint. We already have extensive wireless distribution in Lumen geographies, and soon, we'll have the network assets and deployment capabilities needed to offer customers a better choice for connectivity at home and on the go. When we complete our work at the fiber location, we believe we're able to offer that customer access to the internet on a lower marginal cost structure than any competitor, with industry-leading product performance. We see this as a structural advantage that provides us with the flexibility to price and position our fiber services to reach customers in underserved categories and geographies, and ultimately achieve higher penetration.

John Stankey: This includes value-conscious consumers who are currently being served by networks with lower capacity and higher marginal costs. Our ability to put the right offer in front of an expanding customer opportunity positions AT&T to compete on performance and value, and not by leading with uneconomical device offers. As we accelerate the expansion of our fiber availability, this is how we expect to go to market, with offers and marketing strategies that yield attractive returns by driving deeper fiber penetration and growth in high-value, converged customer relationships. We're also making progress towards our goal of discontinuing legacy services in the large majority of our footprint by the end of 2029. We stopped the sales of all targeted legacy copper-based services in 85% of our wire centers.

This includes value-conscious consumers who are currently being served by networks with lower capacity and higher marginal costs. Our ability to put the right offer in front of an expanding customer opportunity positions AT&T to compete on performance and value, and not by leading with uneconomical device offers. As we accelerate the expansion of our fiber availability, this is how we expect to go to market, with offers and marketing strategies that yield attractive returns by driving deeper fiber penetration and growth in high-value, converged customer relationships. We're also making progress towards our goal of discontinuing legacy services in the large majority of our footprint by the end of 2029. We stopped the sales of all targeted legacy copper-based services in 85% of our wire centers.

John Stankey: The FCC has approved our applications to discontinue copper-based services in more than 30% of our wire centers by the end of 2026. We appreciate the FCC and Chairman Carr's continued recognition, the importance of modernizing communications infrastructure, and remain committed to supporting our customers every step of the way. The transformation of our network and support infrastructure is also driving the transformation of our cost structure as we benefit from open technologies, simplify our business processes, and deliver a better customer experience. Last year, we achieved over $1 billion of cost savings, and we plan to accelerate efficiency gains across the company by leveraging AI, moving more customer transactions to digital, and achieving greater operating leverage as we grow our customer base.

The FCC has approved our applications to discontinue copper-based services in more than 30% of our wire centers by the end of 2026. We appreciate the FCC and Chairman Carr's continued recognition, the importance of modernizing communications infrastructure, and remain committed to supporting our customers every step of the way. The transformation of our network and support infrastructure is also driving the transformation of our cost structure as we benefit from open technologies, simplify our business processes, and deliver a better customer experience. Last year, we achieved over $1 billion of cost savings, and we plan to accelerate efficiency gains across the company by leveraging AI, moving more customer transactions to digital, and achieving greater operating leverage as we grow our customer base.

John Stankey: We've been investing at the top of our industry for years, and we expect this to continue based on the capital investment outlook we provided through 2028. This outlook anticipates that our major capital projects will be substantially completed by the end of 2030 or sooner. As we complete these investments, we expect our capital intensity to decline from a high teens percent of revenue to the mid-teens, driving higher, durable, long-term cash flow. But our shareholders will see the benefit much sooner. We believe the nature of our sustained investments and execution against the priorities I just outlined position us to drive improved growth now. That's exactly what's reflected in our long-term outlook. Over the next 3 years, we expect to drive accelerated growth in Adjusted EBITDA, double-digit Adjusted EPS growth, and strong free cash flow.

We've been investing at the top of our industry for years, and we expect this to continue based on the capital investment outlook we provided through 2028. This outlook anticipates that our major capital projects will be substantially completed by the end of 2030 or sooner. As we complete these investments, we expect our capital intensity to decline from a high teens percent of revenue to the mid-teens, driving higher, durable, long-term cash flow. But our shareholders will see the benefit much sooner. We believe the nature of our sustained investments and execution against the priorities I just outlined position us to drive improved growth now. That's exactly what's reflected in our long-term outlook. Over the next 3 years, we expect to drive accelerated growth in Adjusted EBITDA, double-digit Adjusted EPS growth, and strong free cash flow.

John Stankey: We also expect to return $45 billion+ to our shareholders over the next 3 years through our attractive dividend and consistent pace of share repurchases. This represents nearly 30% of our market cap and over 75% of our expected free cash flow. Over time, we expect that our improved growth, declining capital intensity, and higher free cash flow will provide us with even greater flexibility to support enhanced shareholder returns. Over the past 5 years, we've evolved how we operate our business to be investment-led, customer-centric, and focused on being the best advanced connectivity company in America. This has changed how we talk about our company, and I think it reflects how we see industry assets reordering to compete with our success.

John Stankey: So beginning with our first quarter results, we plan to adopt new segment reporting that aligns with this reality and the ongoing transformation of our company through the end of this decade. Scott will walk you through the details of our planned new segment reporting and long-term guidance in just a moment. At a high level, we'll begin reporting the growth in our domestic, wireless, and fiber-based businesses, which we refer to as advanced connectivity, separate from the results of our legacy operations. By separating the performance of our advanced connectivity business from our declining legacy segment, we believe investors will have greater transparency into the returns we're generating on our growth investments in 5G and fiber. I'd like to close by reiterating a point that I made last quarter, which is that this is a great time to be in our industry.

John Stankey: In my career, I've never seen federal policy this supportive of market-based investment in advanced networks. This welcome policy stance has been adopted at the front end of an AI revolution that we expect to increase the need for dense fiber networks and more symmetrical connectivity into and out of homes, businesses, and devices. ... We operate in a competitive marketplace. This is not new, and neither are the keys to success, which are investing in best-in-class technologies at scale in order to provide customers with connectivity that they can depend on at a good value. This is a winning play, and by running it well, I'm confident that we'll lead our industry in advanced connectivity service revenue and adjusted EBITDA by the end of this decade. With that, I'll turn it over to Pascal. Pascal?

Pascal Desroches: Thanks, John. We had a strong finish to the year and met or exceeded all of our 2025 financial guides. In my view, one of the key takeaways from our Q4 performance is that it demonstrates our continued success at driving profitable growth, even in a competitive operating environment. We achieved over 4% growth in consolidated Adjusted EBITDA during the Q4, while expanding Adjusted EBITDA margins by 20 basis points. This reflects the margin gains we achieved from growth in 5G, fiber, and fixed wireless service revenues, driven by gains in convergence relationships, while taking costs out across the company. We are also winning with the right customers, with the right offers, and we believe that our investment-led convergence strategy positions us to sustain profitable growth over the next several years.

Pascal Desroches: Looking ahead, we expect annual cash taxes of approximately $1 to 1.5 billion through 2028. Our cash tax outlook primarily reflects further assessments of expected savings due to this legislation. Our goal is to put these savings to work over the next three years to fund working capital and growth initiatives. As John discussed, we are planning to adopt new segment reporting beginning with our Q1 2026 results. Our largest segment going forward will be called Advanced Connectivity, which primarily represents results for our domestic 5G and fiber services. In 2025, Advanced Connectivity drove about 90% of our revenues and over 95% of our Adjusted EBITDA on a recast basis, and substantially all of our organic and inorganic investments support growth in Advanced Connectivity. Our Legacy segment represents results from our domestic services provided over our copper-based network.

Looking ahead, we expect annual cash taxes of approximately $1 to 1.5 billion through 2028. Our cash tax outlook primarily reflects further assessments of expected savings due to this legislation. Our goal is to put these savings to work over the next three years to fund working capital and growth initiatives. As John discussed, we are planning to adopt new segment reporting beginning with our Q1 2026 results. Our largest segment going forward will be called Advanced Connectivity, which primarily represents results for our domestic 5G and fiber services. In 2025, Advanced Connectivity drove about 90% of our revenues and over 95% of our Adjusted EBITDA on a recast basis, and substantially all of our organic and inorganic investments support growth in Advanced Connectivity. Our Legacy segment represents results from our domestic services provided over our copper-based network.

Pascal Desroches: We have a goal of discontinuing a large majority of copper-based services by the end of 2029 and are managing our Legacy segment to achieve this outcome. As John noted, the separation of our Advanced Connectivity results from our domestic Legacy operations should provide investors with a better framework for assessing the returns on our investments in 5G and fiber. For example, over the past two years, our consolidated adjusted EBITDA grew by over 3% annually, while EBITDA from Advanced Connectivity grew considerably faster at an average of more than 6% annually. We also expanded EBITDA margin in this segment each in the past two years, which highlights how we are achieving profitable growth across 5G and fiber services to both consumers and businesses, even in periods of increased competitive activity and while making significant investments to scale our growing fiber and fixed wireless footprint.

Pascal Desroches: We've posted materials to our investor relations website that recast our results over the past three years under our planned new segments. We also intend to provide results for our mobility business as a supplemental disclosure for a transitional period. Now, let's talk about where our business is headed. In our earnings release, we provided long-term guides through 2028 that anticipate improved growth in consolidated financial performance, driven by investments in our Advanced Connectivity segment. Here's how we expect to achieve that growth across our primary service categories. We expect total wireless service revenue growth in the 2% to 3% range annually over the next three years. The primary driver of this outlook is growth in consumer and business customer relationships as we continue to gain wireless subscriber scale through convergence in areas where we offer fiber and fixed wireless internet services.

Pascal Desroches: Our outlook assumes a relatively stable trend in postpaid phone ARPU, as our consistent, disciplined approach to pricing is balanced by gains in under-penetrated categories, such as value-focused customers, as well as growth in converged customer relationships, who enjoy a service discount that typically more than offset over time through lower churn and the purchase of additional services. We also continue to plan for an operating environment with elevated levels of new and existing customers that are eligible for device offers. While this has no impact on our service pricing, it does impact the calculation of ARPU as we amortize a portion of our device offers through our wireless service revenue. This was approximately a 90 basis points headwind to our reported postpaid phone ARPU growth in 2025, and our outlook anticipates a similar headwind this year.

Our outlook assumes a relatively stable trend in postpaid phone ARPU, as our consistent, disciplined approach to pricing is balanced by gains in under-penetrated categories, such as value-focused customers, as well as growth in converged customer relationships, who enjoy a service discount that typically more than offset over time through lower churn and the purchase of additional services. We also continue to plan for an operating environment with elevated levels of new and existing customers that are eligible for device offers. While this has no impact on our service pricing, it does impact the calculation of ARPU as we amortize a portion of our device offers through our wireless service revenue. This was approximately a 90 basis points headwind to our reported postpaid phone ARPU growth in 2025, and our outlook anticipates a similar headwind this year.

Pascal Desroches: We expect our advanced home internet service revenues to grow organically by 20%+ annually through 2028, which is consistent with the annual growth we have achieved in these revenues over the past 2 years. The primary driver of this outlook is growth in customer relationships as we expand the reach of AT&T Fiber and the availability of Internet Air, as we complete our 5G network modernization and continue to deploy spectrum from our EchoStar transaction. Our long-term outlook assumes a lower contribution from ARPU growth than we have seen over the past few years. Similar to our approach in wireless, we intend to maintain a consistent approach to home internet pricing, balanced by gains in under-penetrated customer categories at different price points as we materially expand the availability of home internet services.

We expect our advanced home internet service revenues to grow organically by 20%+ annually through 2028, which is consistent with the annual growth we have achieved in these revenues over the past 2 years. The primary driver of this outlook is growth in customer relationships as we expand the reach of AT&T Fiber and the availability of Internet Air, as we complete our 5G network modernization and continue to deploy spectrum from our EchoStar transaction. Our long-term outlook assumes a lower contribution from ARPU growth than we have seen over the past few years. Similar to our approach in wireless, we intend to maintain a consistent approach to home internet pricing, balanced by gains in under-penetrated customer categories at different price points as we materially expand the availability of home internet services.

Our business customers continue to utilize a range of fixed connectivity services at different stages in their life cycles. Over the past few years growth in our business fiber and advanced connectivity Services which includes fixed Wireless has been more than offset by declines in business, transitional and other services, which includes mature product categories. Such as VPN our Outlook anticipate that service revenues from business customers across Wireless fiber, and fixed Wireless will accelerate over the next several years. And more than offset expected continued declines. In transitional and other services altogether. We expect that total Business Service revenues within the advanced connectivity. Segment will grow at a low single digit kegger through 2028. We also intend to maintain our cost transformation initiatives across the business. We achieved over 1 billion dollars of cost Savings in 2025 and expected to achieve.

Pascal Desroches: Our outlook also factors in the portion of our convergence discount that we allocate to internet services as we grow our converged customer base. We continue to expect that we will close our acquisition of fiber assets from Lumen during the first quarter, which will add approximately $900 million of annualized fiber revenues. So we expect that our reported growth in advanced home internet revenues in 2026 will exceed 30%. Our business customers continue to utilize a range of fixed connectivity services at different stages in their life cycles. Over the past few years, growth in our business fiber and advanced connectivity services, which includes fixed wireless, has been more than offset by declines in business, transitional, and other services, which includes mature product categories such as VPN.

Our outlook also factors in the portion of our convergence discount that we allocate to internet services as we grow our converged customer base. We continue to expect that we will close our acquisition of fiber assets from Lumen during the first quarter, which will add approximately $900 million of annualized fiber revenues. So we expect that our reported growth in advanced home internet revenues in 2026 will exceed 30%. Our business customers continue to utilize a range of fixed connectivity services at different stages in their life cycles. Over the past few years, growth in our business fiber and advanced connectivity services, which includes fixed wireless, has been more than offset by declines in business, transitional, and other services, which includes mature product categories such as VPN.

Pascal Desroches: Our outlook anticipates that service revenues from business customers across wireless, fiber, and fixed wireless will accelerate over the next several years and more than offset expected continued declines in transitional and other services. Altogether, we expect that total business service revenues within the Advanced Connectivity segment will grow at a low single digit CAGR through 2028. We also intend to maintain our cost transformation initiatives across the business. We achieved over $1 billion of cost savings in 2025 and expect to achieve an additional $4 billion annual cost savings by the end of 2028. We expect these savings will be driven by the operating efficiencies John discussed earlier, along with reductions in legacy operations and support costs.

Our outlook anticipates that service revenues from business customers across wireless, fiber, and fixed wireless will accelerate over the next several years and more than offset expected continued declines in transitional and other services. Altogether, we expect that total business service revenues within the Advanced Connectivity segment will grow at a low single digit CAGR through 2028. We also intend to maintain our cost transformation initiatives across the business. We achieved over $1 billion of cost savings in 2025 and expect to achieve an additional $4 billion annual cost savings by the end of 2028. We expect these savings will be driven by the operating efficiencies John discussed earlier, along with reductions in legacy operations and support costs.

Pascal Desroches: We also expect depreciation and amortization expense of about $20 billion annually through 2028, as incremental depreciation from our growth investments is offset by the roll-off of depreciated assets that have reached the end of their useful lives. For 2026, we expect free cash flows of $18 billion+, reflecting primarily growth in Adjusted EBITDA, lower pension contributions, and lower legal settlements, partially offset by higher capital investments and cash interest. We expect free cash flows to grow by $1 billion+ in 2027 and approximately $2 billion in 2028, driven primarily by growth in Adjusted EBITDA. As John discussed, we have plans to accelerate and scale the execution of our strategy this year, and we expect some upfront investments to drive this outcome will be reflected in our Q1 results....

We also expect depreciation and amortization expense of about $20 billion annually through 2028, as incremental depreciation from our growth investments is offset by the roll-off of depreciated assets that have reached the end of their useful lives. For 2026, we expect free cash flows of $18 billion+, reflecting primarily growth in Adjusted EBITDA, lower pension contributions, and lower legal settlements, partially offset by higher capital investments and cash interest. We expect free cash flows to grow by $1 billion+ in 2027 and approximately $2 billion in 2028, driven primarily by growth in Adjusted EBITDA. As John discussed, we have plans to accelerate and scale the execution of our strategy this year, and we expect some upfront investments to drive this outcome will be reflected in our Q1 results....

Pascal Desroches: We continue to expect that our net leverage will return to a level consistent with our target in the 2.5 times range within approximately 3 years following the closing of these acquisitions, and we continue to expect we can achieve our deleveraging objectives while maintaining a consistent approach to capital returns. In 2025, we returned over $12 billion to shareholders, including over $8 billion in dividends and over $4 billion in share repurchases. As we outlined in our earnings release, we expect to return $45 billion plus to shareholders during 2026 to 2028. Under this capital return plan, we expect to maintain our current common stock dividend with a consistent pace of share repurchases through 2028, including approximately $8 billion of buybacks in 2026.

We continue to expect that our net leverage will return to a level consistent with our target in the 2.5 times range within approximately 3 years following the closing of these acquisitions, and we continue to expect we can achieve our deleveraging objectives while maintaining a consistent approach to capital returns. In 2025, we returned over $12 billion to shareholders, including over $8 billion in dividends and over $4 billion in share repurchases. As we outlined in our earnings release, we expect to return $45 billion plus to shareholders during 2026 to 2028. Under this capital return plan, we expect to maintain our current common stock dividend with a consistent pace of share repurchases through 2028, including approximately $8 billion of buybacks in 2026.

John Hodulik: Great. Good morning, guys. Two questions, if I could. First on the fiber convergence rate, 42% and increased by 200 basis points. John, where, where do you expect this level to get to over time, maybe, maybe over the course of the decade? And do you expect the, the sort of rate of penetration to, to, to continue to improve from here? And then follow up to that, do you think you can play catch up in the Lumen territory and, and get to those numbers? And then second, could you... wireline revenue growth looks like it, it slowed in the quarter. Could you just talk about some of the drivers of, of that slowdown? I think, Pascal, you mentioned the discounting going on that side, and just how you expect that to progress as we look through 2026. Thanks.

But our expectation is that you're going to continue to see Improvement in that rate, um, rattly over time. Uh, and in fact, that's the realignment that we're dealing with here, which is as churn goes up on, unbundled customers, buy a bit. We're dealing with that problem right now. Ultimately, the fix to that is to get to more Consolidated. Customers that give us a better turn rate and that that realignment is what we're betting on in our financials, moving forward. And, you know, simply put, if we finish this year at 32, finish 2025, at 32,000 fiber, passings, if we're going to finish this year at 40 million, you know, just do the math on it. And that's how we're basically driving our Revenue growth, and our share and and controlling our our service revenues, and what we're doing moving forward.

John Stankey: Ultimately, the fix to that is to get to more consolidated customers that give us a better churn rate, and that, that realignment is what we're betting on in our financials moving forward. And, you know, simply put, if we finish this year at 32, finish 2025 at 32 million fiber passings, and we're going to finish this year at 40 million, you know, just do the math on it, and that's how we're basically driving our revenue growth and our share and, and controlling our, our service revenues and what we're doing moving forward. In terms of our out of, what I'll call the out of traditional out-of-region footprint, I'll throw Lumen into that right now. We have traditionally, just like we did with GigaPower, been more conservative in our business expectations as to how we perform in those footprints.

John Stankey: Thank you. Good morning. I guess 2 questions around your long-term outlook. One is whether you guys are saving any capacity for, you know, meaningful spectrum investments. There's, I think, a potential for several auctions over the next couple of years under the current FCC. You guys obviously have the EchoStar transaction getting ready to close, but just any envelope for additional spectrum investments or just your view on any needs there would be helpful. And then I guess similar kind of question, more near term. Definitely getting more questions from investors about a foldable iPhone and what that might mean in terms of consumer demand and upgrade rates. Just curious if the 2026 guidance incorporates any view at AT&T on sort of what that might mean for the business and the competitive environment.

Benjamin Swinburne: Thank you. Good morning. I guess 2 questions around your long-term outlook. One is whether you guys are saving any capacity for, you know, meaningful spectrum investments. There's, I think, a potential for several auctions over the next couple of years under the current FCC. You guys obviously have the EchoStar transaction getting ready to close, but just any envelope for additional spectrum investments or just your view on any needs there would be helpful. And then I guess similar kind of question, more near term. Definitely getting more questions from investors about a foldable iPhone and what that might mean in terms of consumer demand and upgrade rates. Just curious if the 2026 guidance incorporates any view at AT&T on sort of what that might mean for the business and the competitive environment. Thanks, guys.

My word networks are down to Flying and the technology is getting a lot better at um you know, price points and how we radiate uh more deeply into networks. And we get dynamics of how we offload as we pick up more combined customers. Um, we have market share dynamics, that play out 1 should conclude that given the depths of the networks that are out there today. When, you know, we're all hanging 300 megahertz off of the cell tower. Um, this isn't the days where, you know, we're growing 10 megahertz at a time on these on these networks we've we've put large swatches of the capacity out there. We have a lot more flexibility in how we manage things and that means that you maybe don't need to think it the same nationally about how you invest in Spectrum assets is maybe you have done in the past and that has a a bit of an opportunity for you to think differently about returns and markets and Investments as you move forward. But we'll be in a position to do what we need to do to sustain the business. Um,

And you look at the conversion rate of those that have left, non foldable devices to foldable. Uh, it's pretty predictable as to who sees a foldable device being a good form factor for them, and I think that's a good indicator that if you were to apply those same kind of acceptance factors and put it in and just say, just because there's a different manufacturer making them is everybody suddenly going to be more, uh, in tune or desirous of a foldable device. The indications in the market would be that, that's not a broadly applicable, form factor. It certainly has its place, and there's some utility that, it brings, but I don't think this is going to be the kind of thing where 80% of the base says, they need that form factor. I have to move to adjust. Do you have a point of view? Not much to add, uh, to that John, other than you should expect that AT&T, will remain focused on the acquisition of quality, customers will be very disciplined and offering the right value proposition to the right customer service.

Hi, good morning, everybody. Uh, 2, if I met the first uh both on broadband actually, first regarding your comments on fiber, rpu, I think we all appreciated your your point about mix and promotions and how those were accounted for in arpu. Um, at the same time, Comcast and Charter are behaving differently in terms of the way, they price existing customer Broadband rates. And so I'm wondering how you're thinking about the price of fiber, for your existing Subs, your your retail rate Outlook. And, and then a question about fwa growth looking out 2 years. It looks like your DSL base, uh, will be gone if we just extrapolate the recent decline rates. Um, and I wonder in that scenario, should we expect fwa sales to hold up. And if so, should we worry about a supply demand problem in high capacity Broadband, does that DSL demand goes away and 3 powerful carriers continue to try to grow DSL. Thank you.

John Stankey: And if so, should we worry about a supply-demand problem in high-capacity broadband as that DSL demand goes away and three powerful carriers continue to try to grow DSL? Thank you. Hi, Peter. Look, I've said it before, I think we're in a distinctly different place than cable. One is we currently sit under their pricing umbrella. We're not at their levels, so we have a lot more degrees of freedom in how we manage our ARPUs and our various offers in the market, that they have. So, you know, it's one thing... I understand why they're having to make the changes they're making. They're priced higher, their product's inferior. And so they're the ones that's having to readjust to the market, not us. We've got the better product, we're priced lower, and that's why this, this, this is a problem for them.

And when you're doing it on the foundation of a better product, that's a good thing I made. The point I made in my comments, for a reason, how do we continue to win and grow and share we continue to grow our footprint. 32,500 passings at the end of 2025 40 million at the end of this year, that's a growth rate. That is, we've never had that and it's going to be 5 million a year thereafter and we'll be working that base. And you have a product that people love, they love it. It's number 1, I said that for a reason, it's priced competitively in the market, it performs better, you put a great Wireless product with it. You have all the Tailwind. You need to be able to continue to do the right things in the market. And there's a structural advantage on how that technology works and performs as well as the cost of operating it once it's in service and what you do with it.

At a macro level. It's no surprise that the wireless industry itself, uh, is penetrated, uh, in a very mature and so you do see a lot of switching activity, that's occurring between competitors. Are there macro factors that are slowing incremental, new entrance into the traditional post-paid voice. Certainly there are some aspect to that, but from our perspective, the plays that we've been running in this competitive environment have delivered, not only, um, growth in our margins, but overall growth in customers. And so we're able to withstand some of the competitive Dynamics as we mentioned before and John's alluded to earlier and is remarks we still see incremental opportunity and underpenetrated segments for AT&T and those segments are being served at a growing accelerated rate for us.

Jeff McElfresh: Yeah. Happy to. Thanks for the question, Mike. At a macro level, it's no surprise that the wireless industry itself is penetrated and very mature, and so you do see a lot of switching activity that's occurring between competitors. Are there macro factors that are slowing incremental new entrants into the traditional postpaid voice? Certainly, there is some aspect to that. But from our perspective, the plays that we've been running in this competitive environment have delivered not only growth in our margins, but overall growth in customers. And so we're able to withstand some of the competitive dynamics. As we've mentioned before, and John's alluded to earlier in his remarks, we still see incremental opportunity in underpenetrated segments for AT&T. And those segments are being served at a growing accelerated rate for us with the plays that we're running around convergence.

Jeff McElfresh: We still don't have the share we aspire to have in some value conscious, price sensitive segments. Think 55+, 1- to 2-line accounts, and as well in the small and medium business segment, both of which we're seeing some success, and interestingly enough, we're seeing success in those segments as a result of our go-to-market convergence strategy. John kind of alluded to this a second ago. The actual number of accounts that we see that we're growing is not just adding wireless customers to existing fiber accounts, but we're actually pulling existing wireless accounts, adding fiber, and the new accounts that we're establishing in the market are from many of these growth segments. So from that perspective, we plan for the competitive intensity to continue.

Hi. Thank you for taking the question, I guess Pascal 1 quick clarification question. Um, does the year end leverage Target? Does that assume some level of cash inflows from the the Lumen JV and it just I guess monetizing a uh a portion of that with a network partner. Um and then I guess uh second question for you know Jeff Andor John um just helping us think about is the thing about the shape of the fiber. Build is trying to talk about going from 32 to 40 exiting the year. Can you help us? Think about, you know, what does that mean? From a, you know, seasonality perspective as we think about fwa and fiber over uh, net additions over the course of the year. I mean similar, you know, to Prior years is 1/2 look, uh, the second half of the higher than the first half in terms of net additions there. And then, I guess what if any distribution changes should be thinking about as it relates to fiber and fwa whether it's you know maybe uh training the stores opening up distribution channels, just help us. Maybe think about the shaping there as well. Thank you.

And so we have, even though there's seasonality to it when you have an opportunity to sell that increases, um, you're going to have some volume that comes in as a result of that. And that's going to be really hard for all of you to estimate this year. Because not only do you have footprint increases, but we have a ramping Dynamic. We're going to be working through, uh, we have closed the Lumen transaction in a record time or we will we will close it in a record time. I'm projecting. And as a result of that, that means we've had a more compressed time to be able to do the pre-planning. You would normally do, uh, up the day of closed to be able to operationally, turn up those assets and move forward. And we have some things that we're going to have to continue to finish up and ramp and scale to get to be our best self.

Do a transaction like this, which is rationalize your information technology infrastructure standardized positions on brands in the market. Uh, go to Common ways of driving Supply chains and and engineering and putting data into databases and all those things. And that's some hard and challenging stuff. We have all that planned out. In many cases, we're in pretty good shape, but I know that for the first quarter or 2, we're going to be on a learning curve on some of that stuff with people from a different company, having to learn some new processes and new ways of doing things. So that ramp Dynamic on that footprint, is going to take a little bit of time and that will factor into, you know, clouding, quote, unquote, seasonality is, you think about those things? You got to ramp Dynamic, you got seasonality, you got larger footprint. You have offers you're going to be moved in the market training, that has to be done for individuals that are going to be Distributing and selling those products. So I think it's going to be a little bit.

John Stankey: Now, offsetting some of that seasonality is we have footprint expansion, and so we have, even though there's seasonality to it, when you have an opportunity to sell that increases, you're going to have some volume that comes in as a result of that. And that's going to be really hard for all of you to estimate this year, because not only do you have footprint increases, but we have a ramping dynamic we're gonna be working through. As a result of that, that means we've had a more compressed time to be able to do the pre-planning you would normally do, up the day of close to be able to operationally turn up those assets and move forward. And we have some things that we're gonna have to continue to finish up, ramp, and scale to get to be our best selves.

John Stankey: We're going to execute on this asset in a way that we are normalizing products between the two operating companies. You're gonna do all the things that you should do when you do a transaction like this, which is rationalize your information technology infrastructures, standardize positions on brands in the market, go to common ways of driving supply chains and engineering and putting data into databases and all those things. And that's some hard and challenging stuff. We have all that planned out, and in many cases, we're in pretty good shape. But I know that for the first quarter or two, we're gonna be on a learning curve on some of that stuff, with people from a different company having to learn some new processes and new ways of doing things.

John Stankey: So that ramp dynamic on that footprint is gonna take a little bit of time, and that will factor into, you know, clouding, quote, unquote, "seasonality," as you think about those things. You've got a ramp dynamic, you've got seasonality, you got larger footprint, you have offers that are gonna be moved in the market, training that has to be done for individuals that are gonna be distributing and selling those products. So, I think it's gonna be a little bit challenging for all of you to kind of just go back and look in the rearview mirror and come up with a dynamic around it, and we'll, we'll give you some updates, but you should expect we're gonna be on probably a, a solid two-quarter ramp here of getting ourselves up the learning curve and getting more effective.

John Stankey: We spent a lot of time paying attention to where customers' understanding are of our products and our perceptions, and that's discrete for consumer and business. We believe, and we've done a lot of A/B testing on this, and we know this, that actually we have more to gain right now from a broader, I'll call it a generic internet message, than at the national level, a targeted message. We want to build awareness that AT&T is a capable national internet provider across consumers and business broadly, and we have a lot of upside in the customer base to do that. Our tracking of our advertising, our approach on that, would suggest we've made some really good calls around that, and it's helping. What we then do is we come underneath that with, as you refer to it, the targeted rifle shot.

John Stankey: There are other ways to go put the targeted rifle shot in front of the right customer in the right place. And this is fundamental and core to our strategy, which is right product, right customer, right place. And you can use digital means, and you can use information on our customer base and third-party information to go and put the right offer in front of the right customer that matches up to the technology that we have and the particular geography that then comes in and builds and extends on that national message that you're referring to. So we track a lot of things, as you might guess, and we're looking at, you know, do people have an awareness that AT&T is the leading fiber provider? Where are we weak? Where does it not match up against where we got inventory to go sell?

But look, I I think the numbers speak for themselves and we start to talk to you about how we're generating profits in this business and how we're investing. The time has come for us to to look at things differently. And the the shift that's occurring in this industry is pretty significant and uh as a result of that, it's time for us to adjust and make these changes. Um, we have the right Assets in hand after we close these transactions in front of us in my view. And frankly it's it's up to us and it's entirely in our control is to how we deliver on this plan that we just laid out for you and shared with you today. And I feel really good about that and I, you know, feel like we're entering the fund cycle here. Uh, in in, what's been a bit of a slog over the last couple of years to get us in a position to do these kinds of things?

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