AT&T on Monday reported fourth-quarter earnings and revenue that topped Wall Street estimates. AT&T stock climbed as high-spending wireless subscriber additions came in above estimates.
Reported before the market open, AT&T earnings for the December quarter were 54 cents on an adjusted basis, the same as in the year earlier period. Revenue from continuing operations rose 0.9% to $32.3 billion.
Analysts had projected AT&T earnings of 50 cents, down 8% from a year earlier. AT&T revenue was expected to be flat at $30 billion.
During the quarter, the company said it added 482,000 postpaid wireless phone customers versus estimates of 443,000, according to FactSet. Also, AT&T added 307,000 landline fiber-optic broadband customers.
Billed monthly, postpaid phone subscribers are the highest spending wireless subscribers.
AT&T Stock Technical Rating
AT&T reported free cash flow of $4.8 billion, down from $6.4 billion a year earlier, but in line with estimates. Free cash flow growth supports AT&T's dividend.
"AT&T's ability to pay down debt while still paying a generous dividend hasn't meant skimping on capital spending," said Craig Moffett, analyst at MoffettNathanson in a report. "Despite higher-than-expected capital spending and only in-line EBITDA, free cash flow generation nevertheless fully met expectations."
On the stock market today, AT&T stock popped 6.4% to 24.17 in morning, moving above the 50-day moving average. Heading into the AT&T earnings report, shares were about break-even in 2025.
AT&T has a 24.03 buy point from a flat base, though investors could view the pattern as a shallow double-bottom base with a 23.17 entry.
Investors could use a decisive move above the 50-day line, which would be around the 23.17 area, as at least an early entry.
Also, AT&T stock owned a Relative Strength Rating of 80 out of a best-possible 99, according to IBD Stock Check-up.
At an investor day on Dec. 3, AT&T said it expects to churn out over $50 billion in free cash flow over the next three years with $20 billion going to stock buybacks.
Verizon Communications rose 1.5% in premarket trade. On Friday, Verizon topped earnings views. Shares edged up 0.9% on Friday, closing well off lows and still below key levels.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
