AT&T Inc.
T · NYSE
Next quarter
Reports Oct 21, 2026, before the open.
Consensus is $0.62 EPS for Sep 2026 across 8 estimates, ranging $0.56 to $0.69.
T Jun 2026
- 10.17%
- -0.35%
- $0.59
- $0.65
- —
- $31.56B
Reported results
- $31.56B
- $7.04B
- 22.30%
- $4.63B
- $0.66
Highlights
- Earnings beat: Reported EPS was $0.65 versus consensus of $0.59, a 10.17% surprise; diluted GAAP EPS in the filing was $0.66, compared with $0.62 a year ago and $0.54 in Q1.
- Revenue growth: Revenue increased 2.3% year over year to $31.56 billion from $30.85 billion, and was broadly stable sequentially versus $31.51 billion in Q1.
- Advanced Connectivity: Segment revenue rose 4.1% to $28.62 billion, while operating income increased 20.3% to $7.35 billion and margin expanded 350 basis points to 25.7%.
- Fiber and home internet: Advanced home internet revenue grew 27.3% to $2.93 billion; internet connections rose 29.5% year over year to 15.48 million, including 12.87 million fiber connections.
- Wireless execution: Retail wireless net adds reached 549,000 versus 327,000 a year ago, including 432,000 postpaid phone adds; postpaid phone churn improved to 0.86% from 0.87%.
- Legacy runoff: Legacy revenue fell 25.9% to $1.63 billion and operating income declined 45.5% to $523 million as copper-network decommissioning continued.
- Cash investment and spectrum: Six-month capital expenditures rose 15.3% to $10.58 billion, while AT&T expects to close its approximately $23 billion EchoStar spectrum purchase by the end of July, funded with cash and term loans.
- Balance sheet and returns: Total debt increased to $143.95 billion from $136.10 billion at year-end; AT&T repurchased $4.44 billion of stock in the first half and paid $3.97 billion of dividends.
Analysis
AT&T's second quarter was a modest top-line beat with stronger operating execution in its strategic connectivity businesses. Revenue of $31.56 billion rose 2.3% from $30.85 billion a year ago and was nearly unchanged from $31.51 billion in Q1. Reported EPS of $0.65 exceeded the $0.59 consensus by 10.17%; the filing reports diluted GAAP EPS of $0.66, versus $0.62 in Q2 2025 and $0.54 in Q1. Operating income increased 8.3% year over year to $7.04 billion, while net income attributable to AT&T rose 2.8% to $4.63 billion.
The defining feature was the mix shift toward Advanced Connectivity: segment operating income rose 20.3% to $7.35 billion on 4.1% revenue growth, lifting margin to 25.7% from 22.2%. Wireless net adds improved and fiber-led home internet growth remained strong, helped by the Lumen mass-markets fiber acquisition. That progress more than offset the ongoing copper decline, with Legacy revenue down 25.9% and operating income down 45.5%. The quarter also set up a capital-intensive second half: first-half capex reached $10.58 billion, debt rose to $143.95 billion, and the company expects to fund its approximately $23 billion EchoStar spectrum purchase with cash and borrowings.
Advanced Connectivity
Advanced Connectivity remained the central driver of the quarter. Revenue increased 4.1% to $28.62 billion, with service revenue up 5.1% to $23.48 billion. Operating expenses declined 0.6% as depreciation fell 6.9%, more than offsetting 1.4% growth in operations and support costs. Operating income therefore rose 20.3% to $7.35 billion, expanding the margin to 25.7% from 22.2%; EBITDA margin increased to 42.0% from 40.5%.
- Consumer: Revenue grew 4.9% to $22.33 billion and operating income increased 11.7% to $7.12 billion, with margin improving to 31.9% from 29.9%.
- Business: Revenue rose 1.4% to $6.29 billion, but operating income swung to $226 million from a $267 million loss as operating expenses fell 6.3%. Business fiber revenue grew 10.0%, partly offset by a 16.6% decline in transitional and other services.
- Cost drivers: Management cited transformation savings, lower content licensing costs and tower-transaction gains, partly offset by higher advertising, customer costs from the acquired fiber business and bad debt expense.
Wireless and fiber demand
Customer metrics supported the revenue performance. Wireless service revenue rose 3.3% to $17.41 billion, while advanced home internet revenue increased 27.3% to $2.93 billion. The Lumen fiber acquisition contributed to the home internet growth, alongside continued expansion of AT&T Fiber and Internet Air.
- Wireless adds: Retail wireless net adds were 549,000, up from 327,000 a year earlier. Postpaid phone net adds were 432,000 versus 401,000, and retail wireless subscribers reached 109.8 million, up 1.0% year over year.
- Churn: Phone churn improved to 1.12% from 1.17%, while postpaid phone churn improved to 0.86% from 0.87%. Prepaid phone churn also improved to 2.30% from 2.43%.
- Internet footprint: Total internet connections reached 15.48 million, including 12.87 million fiber and 2.61 million fixed wireless connections. Internet net adds were 646,000, including 367,000 fiber adds.
- Fiber revenue: Advanced home internet revenue grew 27.3%, while business fiber and advanced connectivity revenue increased 10.0% to $1.95 billion.
Legacy network runoff
The Legacy segment continued to contract as AT&T decommissioned its copper-based network. Revenue fell 25.9% to $1.63 billion, while operating expenses declined only 10.8% to $1.11 billion. Operating income consequently dropped 45.5% to $523 million, reducing margin to 32.0% from 43.6%. Management expects demand for legacy services and the associated revenue decline to continue.
- Six-month trend: First-half Legacy revenue declined 25.6% to $3.40 billion and operating income fell 42.6% to $1.14 billion.
- Cost structure: Lower personnel and other costs from network decommissioning helped reduce expenses, but the savings did not keep pace with the revenue decline.
- Portfolio direction: AT&T assigned no goodwill to the Legacy reporting unit, citing expectations for sustained service-revenue declines as copper operations are exited.
Capital spending and spectrum
The quarter preceded a significant spectrum investment while AT&T continued to spend heavily on network infrastructure. First-half capital expenditures were $10.58 billion, up 15.3% from $9.17 billion a year ago; including vendor financing payments, capital investment was $11.22 billion. AT&T expects to complete its approximately $23 billion acquisition of EchoStar's 600 MHz and 3.45 GHz licenses by the end of July 2026.
- Funding plan: Management expects to use cash on hand and term-loan borrowings for the EchoStar transaction. Cash and equivalents were $17.57 billion at June 30.
- Debt: Total debt rose to $143.95 billion from $136.10 billion at December 31, and the debt ratio increased to 52.8% from 51.4%.
- Network investment: Capital spending is directed primarily toward fiber, 5G and network upgrades; spectrum and network expansion are intended to support future capacity requirements.
Cash returns and liquidity
AT&T continued to return capital while maintaining liquidity for acquisitions and network investment. Operating cash flow from continuing operations was $18.40 billion in the first half, versus $18.81 billion a year earlier. Cash generation funded $10.58 billion of capex, acquisitions, debt repayment, buybacks and dividends, although the balance sheet absorbed additional borrowings.
- Buybacks: AT&T repurchased approximately 174 million shares for $4.44 billion in the first half, leaving $1.30 billion under the 2024 authorization and the full $10.00 billion under the 2026 authorization.
- Dividends: Dividends paid totaled $3.97 billion, while the declared common dividend remained $0.2775 per share for the quarter.
- Liquidity: AT&T had no outstanding balance under its $12.00 billion revolving credit agreement or its $17.50 billion delayed-draw term-loan facilities at June 30.
