AT&T Analysts Cut Their Forecasts After Q3 Earnings

AT&T reported in-line adjusted earnings per share of $0.54 for its fiscal third quarter, though operating revenues of $30.71 billion slightly missed analyst consensus estimates. The telecom giant demonstrated continued growth in its Consumer Wireline segment, adding 288,000 AT&T Fiber and 270,000 AT&T Internet Air net subscribers. CEO John Stankey reiterated confidence in the company's investment strategy and affirmed its 2025 consolidated financial guidance. Following the announcement, analysts adjusted price targets, with Barclays lowering its target to $28 and RBC Capital to $30.

Analysis

AT&T reported in-line adjusted earnings per share of $0.54 for its fiscal third quarter, aligning with analyst consensus. However, operating revenues of $30.71 billion, while up 1.6% year-over-year, slightly missed the $30.87 billion consensus estimate. This indicates a mixed financial performance, with profitability meeting expectations but top-line growth falling short.

The company demonstrated robust operational strength in its Consumer Wireline segment, adding 288,000 AT&T Fiber and 270,000 AT&T Internet Air net subscribers. CEO John Stankey expressed confidence in the "differentiated investment-led strategy," affirming the company remains on track to achieve its 2025 consolidated financial guidance, emphasizing leadership in convergence.

Despite the positive operational momentum and reaffirmed guidance, analyst reactions were tempered. Barclays lowered its price target from $30 to $28 (Equal-Weight), and RBC Capital reduced its target from $31 to $30 (Outperform). These adjustments suggest that while the company's strategic execution is noted, the revenue miss or broader market factors may be influencing valuation perspectives.

Key Decisions for Investors

• Investors should closely monitor AT&T's revenue trajectory in upcoming quarters, as the slight miss against consensus in Q3 could signal ongoing top-line challenges despite subscriber growth.
• Evaluate the continued momentum in AT&T Fiber and Internet Air net additions, as these segments are critical drivers for the company's reaffirmed 2025 financial guidance and long-term strategic success.
• Consider the implications of recent analyst price target reductions, which may reflect a more conservative valuation outlook for AT&T even with strong operational execution and management's positive commentary.