Breaking news: AT&T free cash flow rises over $2 billion in Q1 earnings

On April 24^th, mobility and fiber service provider AT&T (NYSE: T) reported their first financial results for the 2024 year.

AT&T is the second of the United States telecoms giants to announce their Q1 earnings, with Verizon having reported on Monday and T-Mobile reporting results tomorrow.

A highlight for the company was its free cash flow figure of $3.1 billion for Q1, up a whopping $2.1 billion year-over-year (YoY) from Q1 of 2023.

Net income stood at $3.8 billion, while operating income was $5.8 billion versus $6.0 billion in the year-ago quarter. When adjusting for certain items, adjusted operating income* was $6.0 billion, essentially flat with the year-ago quarter.

Previously, the company had reported operating income of $5.3 billion in Q4 of 2023, which was a 10% year-on-year increase from Q4 2022.

AT&T reported earnings per share (EPS) of $0.47. This was higher than AT&T’s previous EPS of $0.30 per share for Q4 of 2023.

Company revenues were at $30 billion. In the previous quarter, AT&T’s revenues stood at $32 billion.

Adjusted EBITDA was $11.0 billion versus $10.6 billion in the year-ago quarter.

Cash from operating activities came in at $7.5 billion. Previously, the company had reported $11.4 billion in cash from operating activities for Q4.

Mobility service revenues were also positive at $16.0 billion, up 3.3% year over year, while consumer broadband revenues stood at $2.7 billion, up 7.7% year over year.

Old rivalries

The figures were a victory over AT&T’s longtime rival Verizon Communications.

Earlier this week, Verizon beat estimates and pleasantly surprised the stock market when it reported revenues of $33.2 billion and an EPS of $1.19 for Q1.

EBITDA for Verizon also climbed 1.4% to $12.1 billion, while the company’s wireless service revenues rose 3.3% to $19.5 billion.

Expectations

Ahead of the results announcement, analysts expected AT&T to have a higher EPS, but lower revenues, with EPS anticipated at $0.51 per ordinary share and revenues for the company expected to come in at approximately $30.5 billion.  

Outlook for the 2024 year

In its previous results, AT&T outlined its expectations for the 2024 financial year. They included:

• Wireless service revenue growth of about 3%
• Broadband revenue growth of 7% or more
• Adjusted EBITDA growth of about 3%
• Capital investment* in the $21-$22 billion range.
• Free cash flow* in the $17-$18 billion range.
• Adjusted EPS* of $2.15 to $2.25

Having already made some of these goals in the first quarter alone, it seems safe to assume that AT&T is on-track to achieve its 2024 goals for now.

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