- Earnings call transcript Q3 2022

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Operator

Thank you for standing by. Welcome to AT&T's Third Quarter 2022 Earnings Call. [Operator Instructions]. I would like to turn the conference call over to our host, Amir Rozwadowski, Senior Vice President, Finance and Investor Relations. Please go ahead.

Amir Rozwadowski

morning, good and you, everyone. Thank third Welcome call. to our quarter Investor AT&T. Amir Rozwadowski, for of Head I'm Relations

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

to that some our I call need Before forward-looking. may of harbor we says your comments begin, attention It statement. our be to today safe

Investor differ that, risks materials always, as additional turn and earnings As to described over Stankey. AT&T's And and such, to they're With SEC John? materially. in available Relations on the call the are uncertainties I'll subject filings. website. Results may John information

John Stankey

we execution of heroic. areas for scene, nothing Thanks, customers. again, some Amir. they sacrifices, access Good vital shared in solid to first with of morning, our fiber-based along to running FirstNet, The in hardest our strong month, our Earlier efforts. quarter supported everyone. working by the hit delivering yet AT&T our best-in-class made, deploying responders, say how spectrum again, This their the we people. to which, customers. devastating and services mid-band of building in grateful effort connectivity just teams very of short services morning, to is keep for I'm tirelessly like our invaluable out these their of our really results, their truly network I'd thank was execution our ability with critical also all proud to of for yet you and solutions. to third XG the demonstrate many first this to arrive others saw the so are. were, some In Hurricane teams Ian, proved be on the to our aftermath And connect

to and customer and is and from XG strategy. continue continues our fiber fiber resonate. and reliable go-to-market our you growth The at XG focused results, consistent strong high, our an we As the disciplined for demand and back can fast of on strategy deliver to see all-time

In optimize business, lap our investments we line, to of to to EBITDA transform by addition, our now bottom as as we're the fall need suggested and improve benefits networks, the adjusted and growth. accelerating we growth as our seeing we they would begin evidenced distribution our

in by a quarter XXX,XXX net posted adds. postpaid Let we another me strong In of bit. Mobility, adding dive growth phone

in As consistent are better I driven proposition, our our an leverage. costs our value EBITDA. network We're This phone operating ability acquisition improving. are us efficiencies and growth through quarter, in key stated to experience are. measurements: prior and quarters, customers performance This teams accelerating delivered our past is results across our net Mobility distribution, further being gains meet their and X higher postpaid improved drive helping ARPU adds, needs creating strong where by

about year-over-year we the service continued the year, the basis to growth. strength the net X.X% expected This we the higher add and end where than than X% and in decade, expect of start growth range. to fact, marked service a of at thanks wireless to points highest is revenue land now ARPU to XXX third our growth achieve at upper wireless In quarter more revenue

We're a increasing customers in available. with what more just where strategy for expectations wired is of let's We're in steady success in premium adds, the invest we customer on The we XXX,XXX long-term customers business. to Now IP net finding within past Wireline serving our to in our fiber, technology network Ultimately, posted our trends evidenced XXth ARPU and strategy around jump they out favorable continue centered we adds lifespan. already best-in-class markets fiber offering And XXX,XXX than our profitable and deliver will stated more building quarter. decide upgrade This finally our fiber put, that the fact Internet new more subscribers. the to be by growth. a winning. overall share play, with to providing and Internet we service existing success infrastructure, fiber net need we have is others converting a footprint expect is keep our numbers driving best and their multi-decade straight Consumer and this with broadband great where show quarter sustainable with win. with we When fiber, growth to subscribers our technology. network is a Simply fiber

done best a look what step with achieved let's far quarters. minute So phone be across an million for expect X.X net than a we've industry more so year adds. postpaid this at back take We've we and what X will

Additionally, our teams are assets and are our we're performing even spectrum the expectations. than and efficiently, deploying better out quickly our mid-band high spectrum XG rolling

This well. a as the increased to our our progress now more by expectations the when target XG already XXX million and we've year. we achieved nearly our customers end of benefiting year, As POPs reach year-end of million mid-band XXX is entered result, the than double expect people

the of already a In the to twin the year, financial track added consistent deployment. as our Fiber also happy X.X adds, by network our million X nearly X year, of mid-band customer high-quality us summary, have approaching of locations In and with target locations across keeps materially AT&T and million end adds fiber. we're speeds This strong, growth bring achieve returns we've million. and XXXX. durable engines fact, through million-plus net increased and the fiber XX.X since download XG seeing total customer the on XX to We're of enhancements very our quarters start our of I'm locations result to our for improving

we next that our effective operations. priority. our than across ever and important efficient to be It's Moving more

have run strong our cost of rate of billion more visibility by achieving this $X billion $X to transformation on end savings continue than We the target year.

been contribute to whether dispositions, trends proactive like we're asset This year are spoke to that continues line. so earlier, fruition. face to said uncertainty. investing to savings under reorienting to through about of strategy. that decision transforming Many focus the in coming to at now the cost the one of was economic of the we've pricing operating and a rising start I As or as address business why we what it the our bottom We're start beginning our see world feels transformation period reason is measured our inflation a we intently on assumptions business, the

when a a seeing how As is to and our our did sheet profit we result now continues result, benefits our trends. did of has network it. improved, we're to and performance balance get This better, acting we direct some

the backdrop. or our surpass that Our easy best environment available. while technology financial predict, affords investing to all is third demonstrate current in to not our flexibility ability our commitments meet business of quarter deliver results challenging the us even The against can the but

next investments our These to each and we're in long-term and fundamentally future turning investments the over economic AT&T decades. passing sound, and for confident XG cycle justification The the strategy. to data approach grow foundation Now year our fiber be will continuing as support invest feel growth. through remains to of our traffic capital to allocation continues prove to to demand beneficial prove dramatically. few will We increasingly with be this

This very focus yields going profitable our the after me helping and fiber disciplined needs, connectivity of our and mobility we're manner on in and is customers' comfortable quarter. strength subscribers to cash a with forward. ability makes us growing business meet after continue Our core quarter and quarter improving

free hope quarter despite the At third on our flow our the cash to for flow cash our that spend, is free capital billion target for $XX and was dividend quarter for confidence healthy $XX we higher this billion to for deliver ability gives previously year. the in to quarter $X track commitment. in capital flow same investment more ample the investment time, range free line the a on plan for cash our in achieve stated than expectations year, with we're our Our you support billion the level

me allow this I over with this. Before turn to finish to Pascal,

the results for drive forward sustainable industry. the more than on put years. future business, the the right of and the but focused strategy free demonstrate scalable a X that flywheel ago is not flow only creating strategy many years that We're businesses of our Our cash for communications for future we

historic forward. shareholders hold cash for continue improved choices setting our America's you'll the the through and benefit investments to growth act levels earnings investment, while in the We stage moving that now our will accountable against and customers and provider. as our confident of making see ourselves We're also we're conversion next which broadband for future, best

it now Let quarter. Pascal turn over of me Pascal? details discuss the the to to

Pascal Desroches

Thank and morning, good you, John, everyone.

areas subscriber our for taking results focus market Slide our by a X. on look start Let's at

net postpaid with Our quarters as Since ago, successful transformation X consistent million improved we phone phone began we've postpaid nearly delivered net in strategy Mobility along delivered X our quarter. remains ARPU. adds, the we XXX,XXX adds

adds in net quarter Fiber. Looking marks totaled second quarter. at XXX,XXX best ever. our AT&T We the This

from Wireline plan remains copper-based fiber, we're a product just pivoting Our to Consumer that. and in on centered doing

we've X.X from quarters, million X to Fiber X past gone the AT&T base approaching subscriber now a million. of Over subscribers

we customers So mobility with pleased we're the with in fiber. the marketplace and have really across momentum

consolidated Now X. on summary our quarter third financial Slide to let's move

and Warner transaction businesses, Warner Vrio, in a as other closing April, present discontinued of financial recast have divested Media certain Xandr results and Playdemic the First, Media reminder, including with the historical operations. as been to

higher in offset is I Business Therefore, in nearly or like-for-like some results partial partly by our a growth included driven for Comparative XXXX comparative adjusted year X.X% Wireline versus a than up revenue extent, Wireline. other was in Comparative basis. revenues growth Mexico Consumer lesser as results month Additionally, challenges a and a and for year year-over-year year-over-year This $XX comparative million highlight there Consumer as be ago. up quarter. quarter This prior was revenues. EBITDA continues the and, Wireline DIRECTV billion, to were by by decline dispositions more Mobility, decline offset X the also partly $XXX Wireline. in X% a wireless were on financial applicable, largely a will Business to for Mexico where

fiber also from plan operations basis, million impact the began quarter of the stand-alone Adjusted of technology the EPS lines to to EPS favorable half about and balance EPS The year-over-year was adjusted recurring $XXX and XXXX. $X.XX. as and quarter XG lap for grow improve comparative network that investments continue continuing bases On second was change. a shutdown costs in includes adjusted expect EBITDA AT&T from for the ago in our benefit wireless retirement/medical the the to trend year We quarter. stepped-up year of customer a $X.XX in we

the adjusted billion Cash up our year-over-year, now $X.X full higher. Capital and $XX.X was the billion For billion the up EPS came in we to at for quarter. cash be billion capital quarter, the $X.XX shared $XX operations for of for all year. from expect DIRECTV $X $X.X investments or from year. activities continue operations the achieve of billion. operating for continuing year, we X% we year-over-year. the about continuing targets range previously in on Overall, in cash $X.X investments to were our surpass expect was Free or remain billion distributions to track flow financial

a look segment with take Slide X. at Mobility Now our let's deeper starting operating Communications on results,

growth. trends. unlimited higher-priced EBITDA continue to result half Mobility in service a largely the lapping revenues Our $X.XX began with revenue phone Mobility due to $XX.XX, balance from of and This sequentially Year-over-year, investments We Mobility momentum continues pricing were growing business growth growth Mobility and is delivered targeted our that was subscriber revenue by EBITDA, to and our X.X%, ahead continues come up to increased X.X% of and network X.X%, improved strong driven regard XXXX. more our that X%, EBITDA year of growth. ARPU positive of through in Revenues second roaming shutdown highest year-over-year. postpaid XG customers ever. its trends of will up benefits actions, accelerate subscriber to expectations. confident remain the the trading the This by up profitability EBITDA Mobility wireless we plans. With driven

our happy Mobility and is strategy consistent So we're great performance, yielding with results. our really

X. turn on to and our let's Wireline Now results for Business Consumer operating Slide

fiber remains fiber. strong, Our share and growth have win where we we to continue

to quarter customer shift Consumer fiber continued revenue by to services. revenues mix Wireline higher even growth declines grew from and X.X% again nonfiber driven ARPU, this revenues due broadband are fiber. Broadband Our total up with broadband

pricing ARPU and to continue fiber $XX.XX, expect as constructs. to Our to more and customers simplified improve was pricing roll legacy promotional we on that off

lower Looking adds. seasonality forward, net remember in quarter the that results typically fourth in industry

of on to growth We This broadband technology balance XXXX. driven by expect EBITDA lapping in and in the XXXX. of a that revenues strong began be half growth second the will basis the of year-over-year for investments remain

at Looking Wireline. Business

services regard, continue we continue owners' portfolio and revenue and We to our as on this fiber our with where focus continue perform restructure core grow rationalize both a connectivity offerings In to we economics. connectivity to well. have XG

momentum FirstNet base growth service of sequential remains Business in with our XXX,XXX. mobility revenue strong, increase X.X% of Wireless a enterprise and Our wireless

in million in Additionally, year. million the quarter. from we the about more is had $XXX transaction prior than This property revenue intellectual about $XX

For action an the context, this favorable in when we've opportunities past is taken arise.

Now unchanged, and allocation core I'd capital on our Overall, of lift we're the heavy strengths. largely on priorities strategy. past our touch our to quickly like remain focus our company's reorienting connectivity

established for structure the better As sustainable we've us financial result, more a a current that environment. positions

$XX the line range of sight our the flow to We given timing billion enough of the in with investments, our And in obligations. expectations. largely about for financial also invest was we expected our while cash our good free $X.X year. cash the in capital our have flow third target to business achieving billion our feel flexibility In line free quarter, meeting the we delivered in

comfortable dividend future cash commitment, We this only paying the are years after expect here. levels should very from our improve cash in as conversion we to with and increase our

today results we only Our we the year. that stronger our have will exit further than solidified entered XXXX confidence

In flows XXXX. cash continue in free fact, to and higher EBITDA growth we expect

adjusted We that's after when as fourth Q&A. a with excess share our to typically use ready XXXX debt also dividends reduce guidance EBITDA we'll we plan presentation. goal a do, net quarter of And to to provide now Amir, X.Xx. to results. reaching we range We're cash our for of continue debt

Amir Rozwadowski

the Thank ready you, first Pascal. Operator, to we're question. take

Operator

JPMorgan. with line our And first of Cusick [Operator today from Phil comes the Instructions]. question

Philip Cusick

free that I the about bridge guess, fourth cash the Pascal, help to quarter. just reiterate, us as to we flow $XX go think into billion, first,

changed, You a need sounds next what then for billion, industry like billion overall? at taxes, That's and $XX can flow we know world the CapEx, you you guide good much of I cash free should anymore? as want don't And is it. pension how least $X how to the about we it, down. us, it things said think it's think give has And like given part well as update as you but relevant even year, coming about that

Pascal Desroches

to $X.X $XX appreciate With to is simple we $X.X question. I regard spent billion this start. let's Maybe quarter. way think year, for And capital. the delivered it, the when this billion Phil, that billion about the we in

billion. for guide full year Next quarter, we the of reiterated our $XX

that quarter, around next $X.X suggest So would billion.

And convert need you -- the to gets do for the you matter a so year. general that And simple half of a the as first math, well, the get to exactly we the fourth where as year. full higher rate always of you at than the half quarter the back year,

all, So line in of sight. great all

reason grow and that cash year-end results. as flow year. to at you cash to In grow guidance you last we updated With right prepared going EBITDA terms update remarks, to is and expect said, of quarter why macros. now, we next we what our heard we'll the year, when -- the -- stick very next providing fourth to not That mentioned you our from next that in we're my report are quarter communicated free we

we continuing In look nearly past quarter, fact, just we grew ops from at XX%. this if cash

really and drive strong and it's what growth is the year? business, growth So we the cash this going coming factors are are into earnings to organic Mobility. from the that -- next year. improved anticipated What exactly

we're expected year. are and we with base anticipated, that fiber fiber Two, performing profit mobility bigger higher and mix much Subscriber better. than is higher to we is well. is the really than coming trends comes seeing Again, better Our business ARPU. into performing fiber. the margins, shift ARPU

expected overall things to Wireline investments Consumer Business that of then efforts see on because some starting cost a next you time. our also have moderation the fall like peak top to layer to dissipate to bottom We undertaking. begin savings, and of that transformation more to Wireline the the grow year. that's trends we -- in should So And are is as broadly, over begin expected line

I'd interest and higher -- is less mind consistent to we is with in And And delever. say, previously working as trajectory then a when be billion lower that taxes. to we by factor partially guided, model Magnitude, the then flow, what is keep slightly So and cash cash all $X really All offset another we've of free feel commitment and look good exactly in as all, of business. is DTV you at an annual distributions. about the growing dividend we anticipated. the going

Operator

Feldman Our the with next Goldman comes line question of Brett from Sachs.

Brett Feldman

two fiber. sort on here of just Really,

it's great that see fiber the to gain is, net The first momentum. adds to continue

yet you broadband subscriber sustainably a but positive You nonfiber, net broadband than turned now have fiber growth. corner on quite larger haven't the base

And comment there there. sure the considering need I'm you to path limited so a potential I is, just do yesterday follow-up that see you're say. you And how there? on report on get then what unfolding question footprint you're you you fiber a And fiber can was can was the hoping on somewhat bigger a JV.

out the existing question is would fiber being build flow completely higher of funded cash be, your operations. from your So level

were So a boxes with kind looking have check? something to incremental, something if of else? you you speed or breadth potentially partner, including or to what Is this would do about

John Stankey

fiber improve the a appreciate allows us question. to our relative add I performance bigger Brett, broadband. in Certainly, net footprint

to Consumer fiber as our that's to subscriber for of counts, the as fiber relative what continue question Pascal the we over quarters, that we to journey understand, have I an copper several be of next we're the better focusing at on to frankly, of our the our new continue I profile, of the yields and And on much that dynamic infrastructure industry. that to and scale know ought at we accurate of business that's think you think ARPU, short I strong other is, customers we'll you indicated the you, the around, your performance for about got just what churn there's the which, base. observation that in But X. out on growth, know be of it's business in the we'll committed working think I a terms others time something getting least and several about increase the quarters to. whole of And I our it. looking seeing customers. would don't we observed to business, margin near Combination this that legacy But still should and to answer expansion call, improve operating course, close room profitability and, are, the dance add you're the Wireline move continue in characteristics than out promise lot in still economic and as you've dynamics might the through are the doing a I that on your question through that we to that I could of in size fiber territory. builds to operating think

First or what of going comment cost we work of think scale recently into we'll that, those in get, opportunities at the Arizona, management area I'm our that on do wireless think So relatively a there's value with the we because warrants around be competitive that operate in geography when it forward up I first subsidy rate would operating and them. and brand in as that think would should the most distribution? as shown and the need the operating existing believe speculation how return all, we then was fixed will the circumstances our the it sort team media. dynamics Number having to not your found doing have can are we to as of set be have think for go in, interplay where tell market to it? model we that and think quickly of that's some as our we in evaluating footprint. And possibly But federal and opportunities indicated our make I business pace an open the do a area that within overhead improving can on perform, would use we not look of opportunities call, build cost penetration we of public many as same criteria area? in capital the get well, that I Mesa, capital well, in of terms to same our I've marries and a an that we're shared that it have in Two, going and around effectively some to a types low I in otherwise. region, about with in infrastructure of evaluate on Three, extent we in that places, there moves us specifically that that start-up? as you, criteria and that same I that to one, in of pair and municipality pursued we might particular some I the had under and provider economic the the to And building about it's in the acknowledge returns things asset fiber like is we is that there up we were monies and coming finally,

Operator

line the to Morgan Flannery with Stanley. Simon of next Our

Simon Flannery

comments opened the you your John, of a uncertainty. mentioning world period faced

the cash next then deal quarter. free over reiterated from the of the with this would on of at you're if cutting while. to called side, terms looking business last back on cetera, that they could, side you flow quarter. you've issue obviously, And on budgets, update consumer that Good and be out evolve time, It some what may how for few real the been demand? the seeing You've as inflation great and Pascal, hear in us the et IT stresses little a quarters both

increases about payment you So bad on on going think sort and churn debts could we of should here pricing as sort forward? of perhaps trends how us update your mature

John Stankey

are tell the architected it's we've of the any as that and don't welcome basis. we're networks And making of And managed and selling the start, less infrastructure think of is those that segment. moving and on I've there play on very out it's on we're more on out reasons that, And owned that little that's a over it, a change businesses. to dynamic putting bandwidth side, Simon, are we I SDN-based how get appropriately into an When efficiency technologies don't those for bit intensive. Sure. to you, enterprise to the upside deploy benefit we and large here. SDN. from into in the add economy. and the careful that somewhat a about cloud, them an treat SDN previously highly established I the we very we're infrastructure now repositioning were we'll where business not it's private -- is, transition. important I aggregate more color business I on the one business But networks in is operated And through I talked secular bandwidth-intensive operated a and operated us. well we on one then Pascal us efficiency would business story we And most are overriding business can connections owned talked sure we secular be actually and of want it, disconnected back an infrastructure. time, play why And in and highly to gets But to painful why change to put to in managed Look, the workloads things in so is the but uplift actually had because owned and infrastructure. is on and core handle simply less are that about think that one think about costly we managed that reasons connectivity there'll out dynamic, in

architectures in and in bit you've bit. it trends on little that margin for in do that is don't it think years we're And down are on slow it embedded my seen base transition. change they an move subscribers as want it existing adjust a us, the down side, people I the are In somewhat ultimately be And segment, certainly, strong that small business. run formation might that segment. But to But unfortunately, slowed strapped, area be to they be. again, budgets perspective, going can there's new what see the I necessarily in if for regard. a did environment. it of the under-indexed what once that, it we networking result that the more it in will that to a in the the expect might I economic a that not down, business efficiently, fixed small if attractive We're demonstrating those beneficial progress I impact an view in don't move so us ultimately of a know frankly, economic would over it that. than business more during like is business if to necessarily in as If a working as would more there are from to that, because economic advanced small and anything, If cycle. hit their are occur efficiency manifested probably, be But structures businesses business think last market infrastructure. might several something as growth And moderate we we're I

little that know impacts it harder impacted share our in -- I more no a some we'll expect last the out moving other could change FirstNet. that. wireless some on economy economic that seen don't been I fair questions see by wireless segment. been now ultimately Relative to did characteristics in had right forward We in of DSO bit your business, space a growth. the abate other if, in down we've fact, that that lot relative A of of getting some sledding, the than how So it's to driven and don't moderate didn't But be trend economic necessarily cycle. softness might even in overly look, quarter. we've

consistently that our that's we to what We're characterized further. year. going occurs for levels. you We impact are have where anything. in in economy, in out been economy would credit to quarter, if you've to see articulated change debt on was slip. performed be to how we're There Certainly, sours economy additional pre-pandemic We, levels. us the kind pre-pandemic any you. one last Last regard, that tends credit I think other. well reflected think, allows now suggest bad our with right accurately through you the we'll hasn't still We It I standards to way we watch for seeing return the guidance back high-quality of correlate to to but I quarter. manage those to what what managing pattern the tracking to back start approaches to goes We reasonably base to the that nothing a and practices if the past seen of or certainly And we have that the dynamics done anything in quality. in haven't to that

making vast and to we with. longer-lived a the we customer be is ARPUs bit. haul were adjustments pricing We comments, is up change on Most some earlier our are long allows higher-value customer. They're characterized changes. we the that return not when us. higher a of able that majority to the plans did public great. pricing think out of comfortable customers their them plans, execute moving importantly, I into the line today to expected It's having a what churn way talking We stickier value of them, more to that over As feel my very in while in them with to the

we some the certainly the numbers been still moving forward. expected. and no seen has in overall, than changes that expected. have come manifested there margin, It churn the what accretive the greater that makes out have we pricing It's that operations On and you

Operator

our And next from Hodulik question UBS. comes of line John the with

John Hodulik

Great. Okay.

have kind You on view what wireless I the change having Ryzen if then in continue in success ARPU guys any have terms product. And us give that in fixed those follow-up, margins. with in metrics broadband and and just X visibility -- even the are to both right a fiber lot JV, and Obviously, of some the a of potentially wireless? head direction? real for mean, the sense as you expansion of there's a the selling in that momentum subs, T-Mobile now

view that your into XXXX. we Just as on head

John Stankey

really pretty business. our I how the bringing John, those we as subscription-based coming in. customer we're level how relationships think understand customer I And the We performing. a understand we know, base base at tend they're to good. what And be and is profitability today and ability every the to run in So you is have mean relationships. visibility sticky

some at look change to things how ways reasonable visibility impacts the dynamics have those work we around and roaming of and through. think going that have like toward I to they're

drivers profitability You some commentary bigger dynamics associated we the in my and subscription with on that. just the about think of how the with of around heard Simon business churn

this, back back the So talked to to right when say, we beginning I the deliver And half be I should look dynamics we have of at to communicated that what the And in we at are and kind why seeing now. aware going half on ability of able the fourth of momentum, the expect we're story now, leverage getting we're understand you the our we're you're that would confidence those operating that to you quarter story. about. obviously continued our right of now numbers we're year middle

lift the the as market, I we we the subscription market that profitability good and that as our in since And brought our see built promotional on bottom And have that. we've maintaining give base feel we us line stabilized all us visibility as starting beginning about quality cost that. that we I've in we've to of into position some our work that quality well subscription move now and done that with around do, as to base. year that a to still the customers are visibility and which, pretty structure the momentum you've would of are think, start said I So seen

I it. anything about And that changed in so really know has wireless. fixed don't feel good I

to customers wireless a for have is durable fiber long that, a sustainable a than new would we're where said network the territory geography of entire be on And into quarter. every number dynamics That X we -- answer on and new geographies that focused matches able It value consumption way the result is as fiber The footprint fixed be of take in that and we're it homes. our million customers a a X small in. not base. and I will We far continue relationships those year to portfolio. those to applications X wireless million superior broad-scale has deployment bring rather equation shareholders. that characterize in grow customers for operating of will haul ensuring I can our consumer we I'd now As nationwide in it, equation Fixed a that the repetitively not our and place million future. high-value, our and operate place that a infrastructure fiber value

to typically into XG and work going to private of We emerge, life investing is drive period vehicles time management our now see my the best use just monitoring a come X-, money is over wireless is against a set growth pristine autonomy we've the of of team's margin best customers, of top because revenues And and putting the of will wireless it fashion network in be the as front high-value the sustainable do use our space. capabilities, be effective of right that shareholder continuing not enterprise best with we service so XG wireless bring of think applications at think wireless promise ready capital. starts scarce we that durable and the in line kind to medical dynamics to necessary I build it to network characteristics it X-year those end the the don't X-, some really the to are next to infrastructure, that put those our at. use to start to operated the business bring of that on in be The want back workloads to to

comfortable And really miss with be I from use I use next into will where anything there? feel scale. it, we so move we'll your perspective appropriate fixed not our as balance Pascal, did year, to broad about but wireless and it's it that,

Pascal Desroches

No.

Operator

the Barden Bank with David of And from of comes our America. line next question

David Barden

talk could. the versus in is fixed and the a I statement? for of little the environment discount then, probably to first affected guess rate how bit the being the income is one X the obviously, we I be PBO Pascal, interest would the DISH returns you the items: floating; I a to guess of affecting business. respect be about wireless I was is Obviously, arrangement impact couple, on guess, into on guess impact rate affected a the talk how if question, could net specifically, would terms the how pensions and second Could other I to the the evolve? at and how, the as kind tailwind the big to that's might expect be we year's year. expected a that would I or on piece date portfolio. if all, just about ask contributor wholesale go to performance you this with

Pascal Desroches

Okay.

environment. rate interest the first, of, terms In

X, our coming X Dave, last of that maturity years the seeing One of over interest did, we advantage to were things low really of out pandemic. reconstruct the historically and we the rates took towers is

basis. the delever debt. are short-term roll to that there done really next a market outstanding our several flows what to free can without we the always In meaningful we've a now, several any it right on average, those. XX% reconstructed to And slightly we is the the is around could tower result, years X% on are way debt years, can we a look higher continue debt dividend fixed. instance we've you raise yielding a our managing out over series at are that of of capital have towers, over that go But cash As maturities -- we next handle need if such and after largely the to

So that interest rate.

In terms picture of mark-to-market, big in terms pension from cash pension, a standpoint. of

foreseeable there's the plan. to probably no pension the let's talk need future, fund For next decade, the

Now foreseeable a coming to that out big have be going the expect going would pension fact I this is of fund that long-term had pension is in of up, we the of And said, to most the with what's noncash terms we've discount about there the company, going On with at we've because -- no important need there now operating think for future. the the profile us we the go to ramp through as the all -- We this But reported -- those anticipate, we up. higher DISH about year. MVNO, down, normalized rate good arrangement it's gains are -- meaningful overall out we're not feel higher that we contributor that, earnings. the is, all, our this. had several years, look with next some should we some pieces interest discounting And of year, it rates. when would a plan fact expense next really that in

Operator

Citi. the from of comes question next our And Michael Rollins line with

Michael Rollins

the wireless Just X% the little grew a it I In X%. the that year-over-year, to in dig and bit service was flagged wireless. around revenue total think to business was more presentation,

if of, more of verticals? wireless in opportunities, you release medium of the this a IoT side terms device opportunity Where in industry the can connected place the the one was And BXB as you differences a success about next release unpack then success. think the bit the XG wireless? industry? consumer are I that you become volumes. press AT&T unpack trends and you to you curious automotive near kind reading that And the any So of on success you're more I I'm of are for the little could where the more seeing those was curious of seeing bit and if and can flagging in inflection business in IoT in the you're term the that referenced in stages side between you're talking of and seeing

John Stankey

Sure, Mike.

question. can get first me if at your see I Let

hit is don't quite follow I feel look, X no tell understand free this, you. think for. I looking then there's But I first me. If the to what alike thing are you're businesses I'd with up

there. on you're consumer the when occur look you at look tell profitability how to you of on, kind to able our kind ARPU And would we're speaking, family at generally a of so plan and the in business segment coming what a would which dynamics looking as you I market at. structures in relative lot of what do tend subscriber occurs characterize depends highest you,

under growth, still but growth approaches. like Our with constructs able we business, are profitable what some in to do highly FirstNet

volume who would get at you better rates. larger to people buy tend As expect,

ARPU that see the in And or aren't buy able little be you less your so at going are segment consumer volume. kind might ultimately be where dynamics than bit through, maybe a they to of flow that to around what business people

and Now the improve fact in start that at we're still And them aggregate. reflective grow. having segment in share, said that's that, to seeing of our you're doing business we're while well very the accrete you're and trends, taking and ARPU looking overall ARPU growing

what's go place So through managing structure, despite are those margin some us healthy the grow average And that that's occurring, differences in as to of our on and helping, and we this dynamic relatively a right of now. for the still quarter, to course, be and as ARPUs ARPU we that's overall, cash you've stable what's yields. seen,

the On term, in changed. look, IoT cycle, vehicles. don't hasn't That our and expect the course guidance really what change the forward. would call of near comes that the that's over to I side, going planning mainstay in demonstrably of I in profitability moving IoT

vehicle that level and regard. each think that today, I of positioned we'll good opportunity continue And that in that in to that's intensity that going spaces think factor build that's growth of in we to in areas that that's for would work the XXXX overall. be an for also and for when that Do guidance as going kind opportunity cycle I kind are about on. we as strong to the planning think get growth think an find space position revenues those characterize well we thing And -- that most time to out to I their in. for next an what I and look attractive the think business-to-business in Mike. to beyond manufacturing responsive you are pattern those you given going questions, develop continue see we, that in of and any communication do. your of think, that IoT the there's there that And don't update to that to our there's to in, a that push you? to I devices changes you're of Hopefully, one But medical over in there's automotive. us way call at say market the I gave I opportunity the of occur, meaningful you

follow to to the want one, here. free refine up you If feel first

Michael Rollins

It's very helpful. to wireless revenue on something service And the I was going business forward? this consumer, thinking, with just the just bigger contributor is revenue continue where going then and business side, service implicitly the faster to you is that a growth even line would than business top expect that the to just overall be

John Stankey

taking and walking driven is driven This better to to able into dynamics have strategy dynamics being we're and segments. device. households we're the of are case faster results successfully number that. is work the and fully we driven these with themselves and stance. you in that. on is market dynamics the how to the for do device more an expect keep processed you, give our when the why saying mid industry partly to able historically And are we we're us not -- market business a and the And managed And in in that visibility bring tuning to distribution been. be shared of FirstNet, that's have some that's the And to upgrade just necessarily way I been, segment. our been by into these part the going first market and in and we've shifting taking people public how of what this And relative share not where have we under effective they not -- in in sure in of our have when there's sales on overall that a we I'm by our think going the And you see approach are that it's profitability on it, market, shift in growth for our than a strategies that business to are the driven that's the affinity the doing when to promotional stance distribution we're sector like responders, at offering as I speak the we're on for going things by we've start that being distribution balance because, occurring. into stores,

Operator

comes of with And Barclays. our from Venkateshwar line question the next Kannan

Kannan Venkateshwar

little seen could. look bit. of sequentially. and to penetration number I rate, you it when were if I mean, bit every absolute on achieve the keeps a we've able first, slowed couple, a penetration last versus accelerating growing the it in But think terms we Obviously, fiber quarter slow at I A then what period. growth little side,

So the accelerating. expect understand puts also I guess, it should what are the is would associated question good forward. and evolve an then, decline that to takes be as we how there mean, is to and nonfiber we go And rate I

of guidance in how fiber a And give terms year, assumed environment just us for potential cash recessions kind you that or we of in growth to for the lastly, on on the Pascal, are transfers sense nonfiber $XX guide billion or next could of of of growth side? the what flow that variables general? the math being free much so the account are fiber And side seeing is from in maybe

John Stankey

let of So some cleanup the here. do Kannan, first let question, I'll me Pascal your and take part then

on So life of insights -- first you been I think the expect we've pretty should into build what this. that, of a is giving cycle and all, you over clear

the it, little goes next call takes a longer. the penetration relatively Let's bit first and XX% quickly, of XX%

natural be we XX% bit, a that's slow as you're a would yourself to rate, to penetration that going curve get when be of to it start so see to you that down that And expected. build, kind and

XX% fiber to business more get in that assumptions deliberate And is case, terminal had subscribers huge now the the end ramp and of our front year to flows to don't returns, is on to of XX% we ratable business has mark. accelerating managed a on business take the even impact of the what of case. the penetration ultimate the impact you effectively kind the there characterization much a into look I've of historic And level the analysis is off we the a cycle meaningful of also X our in biggest getting the that cash characteristic a investment you of one drive cash we're And end curve. previously, with returns front kind And of return to think original the that And penetration. when is shared if pace how penetration of penetration effectively that's the change typical that dynamic that are to quickly of did I big we you versus numbers. with the shared rate occurred how as the of XX% fiber, are, we've first at you we on return things to increase managed and on case. do a which That effective assumption it flow what is. we if doubled

back And We've so at not that I any would to XX% tell had assumptions end hit characterized kind level once already you. success for you, the that regard. of that any that faster. we've we've go you But going in is made that

doesn't allocated kind takes market. and think mean thing. of slowdown of how you're norm I players get as that's to a expected. see hit XX%, a to shares market so and to longer little bad of degree penetration various the we kind It's what And And kind would call to between bit the just going it's we the stability that expect a of It to that be as be historic. been I in of

a enough Kannan. that. of don't on shared transfer rates the look, you kind on you've we disclose But gives bit there, of and that you. hopefully, what's information going So public with got sense publicly little We that

number. closely. in kind think from And that watch fiber conclude increase we order the if of meaningful the pretty coming in be in, it to it. that's we're percentage that I number to of that turning competitors you got track We well turning deliver can total a there's numbers we're

I fiber. a to moving coming established from importantly, market. what kind we embedded once that we in something know in any are over all new But the know you we come cases, we us. almost Because get And don't anywhere good, both long-term embedded where from. It's fiber infrastructure share that right? move the turn customer on think quarter, to They're to in share provider. becomes communicated doing legacy the we we of or this customer -- not them that's going most we're numbers unless has all cable from with

Pascal Desroches

in business I said of But and for earlier, And and year earlier them. in we're an And broader all all I based next even the our year. resilient macros, And businesses to free Kannan, But XXXX. over immune way these articulated of free to both this situation. grow the look, we're are earnings not on through stress our this X/X for what the macros updating we're I the expect just reasons generally view cash of flow, not cash more did upon on. economic terms and potential guidance we as where risk, say, the

you I next -- overall, give we'll mean, that's an So update year.

Operator

with Raymond line the James. Louthan from comes question Frank of next Our

Frank Louthan

With had a I to clearly that. seeing then good activity? question I margin appreciate the possibly how to the on open with to capital you with that can investment own areas wanted going some territory comment forward? those the that Any just your some And back necessarily clear conceptually, follow-up you reach promotional strong wireless, off to outside economical aren't You're would to about wanting but without going need some of be JV. your on your activity success not I forward. promotional fiber be of you're story, improvement of thinking

John Stankey

X.X Frank, now. on sustainable. sustainable X next another let been And if thanks quarter, for that's asking X.XX years, the quarter years. years what's It you question and it's I'll was for know quarterly

we really feel So where are. comfortable with I

look I not in with think today, We're for iPhones earlier there new strategy the play now. call. at where out $X,XXX said I'll the the reiterate what I I sits you're one market and seeing out. the right

market. different have I to we're is what Mike's understand a are our the believe And you place coming both that we our characterized also communicating we're lot your message. you, communicate at characterized of I heavy how at how gets think the question, is be dollars, when done, I you offers for of for aspects not you consumer to from in lot promotion, that how in And We important competitors. really a of have promotional about looking spending of business there's a need to other mix. Goldman our than we advertising growth question as primary the conference a

You're The not just communicated promotional is, customer simply to profitability offer sustainable? our more now do we question across ask or because sustainable. acquisition doing to of formula change and in mix you're business, strategies our seeing distribution have And mix the the the is say, that's mass partners. in stance, people should what things, a a If and not right one very you costs lead improvement. consumer to channels across have formula competitive incent x, advertising being promotional whether or mix and are and sell is your the that's

of ensure seize something business wireless in practice. as company, foundational built We to forward that's ARPU You're have my in the with certainly to It's us that's I running it's not to those improvement, that's if to in and on JV our partners. make business the a an a and to opportunity opportunities structure. duty on past an my will seeing do the to Frank. strength pretty try new The the for I ideas. think a have we move mind core that wheelhouse, brand fiber always them. and It's our that I'm observation, the comment going my sustainable keep and responsibility equation. was to there's that open capabilities we

should you can an and done back, shareholders, and the it's We about footprint we've us expansion works. how look it how and done, used and understand And effectively approach a for think that We've way a before. I in kind differently that the be responsible approach we've certainly think been past. things done we've done. to understand in that means of for

kinds it those all to business, open I of to elements aspects about to keep of forward. got think in I've our mind and moving an things

Operator

LightShed. of that from with line comes And question Walter Piecyk the

Walter Piecyk

you've for X probably revenue, look quarters. I past or postpaid, prior which is at when the John, the the focus on company, for accelerated revenue it's increased

I look that guess, I was talking first So the were handset that, we the you how in when part referenced promotions. talking at about of kind of the everyone question, last about

look legacy You in some saw past now that's growth, subscriber part increases at to we And when and very been the sustained. the year, price of it's plans. on good

So where you're now growth whatever, in you've got to postpaid. this, X%

consensus. will beat probably that If sustain going forward, just you that

even some I you for Maybe You helping there streaming know, don't for help profitability, HBO cut, you component my I going to Max, in increases? do customers. when higher? it to price probably these in a of is Netflix are in? or, second question, growth your you related, increase an to look been be that's subscribers and is X is Or repack And more into new it, to services sustain get part June others your offers for bundling think but of the to don't you which opportunity but need your ARPU going was 'XX, ARPU is think in of order at that for case,

John Stankey

I question. So appreciate the well,

at think quarter. the the I given important First look disclosures we've and you of all, you when it's for what

quarter that that given there's things numbers. the pop onetime some you As know, drive always into a

environment for I X% what growth think it's we're is we get which there's the consistent we're going we the and balance suggest to we that on I your to yields occur, to growth to characterization the time as to when that line visibility answer at of quarter. the more that, announce be, the revenue exactly and you as I'm that, of the confidence improvement the is think each we should to accurate, environment to that yields, falls revenue is improving it. that In a But and look announce 'XX, overall market good factors in yes. any going to this that of need what you not managing the really the to those get manage when moving because to changes X% through today We'll environment, equation change yields a EBITDA. going the have which continue of that look, in expect seen this inflationary manage know to inflation into we're bottom kind the move of make And structure understanding happen. I of to it's rapid reality And in the the lot equation. you've side immediately is going that's I'm simply with improving effectively. one not that revenue And but is of anything to of of going don't side I going the it's have lot we've the the cost cost The guidance of market. given year. and a well

adjust ourselves pull I the to what an year, you environment does. responsible as choose tell both in. of that And things think and ensure strategies prepare that planning assure But team options at market. on sat that, you, But said, be work to tactics give available artifact for -- we've we right in a have are I we've what that. down. got relative as today the I'm management set we looked of we'll And team not to we will Exactly levers equation. has find to can the us we especially we that's preannounced as guidance to lever I or and that the going to of sides the a to around you price how to that

for forward their relative content the still offerings think into others to us. and as expect I market. of content view our We We're being Warner us. 'XX. there's be in going We I worthwhile how as incorporate compete it's adjusting to our and beneficial as But quarter, customers I And On services, in ways Walt, don't we and could of the move get benefit, still lot any strategies that shared effective and into an that an our important content still we've with also relationship one, we would as bundled aspect side, think HBO portfolio. different opportunities a we have the valuable have important from Bros., gotten industry. last that we'll Max to Discovery been that I into content view and

some as I think do that. we change you'll adjust things see and

I'd So say tuned. stay I think

going the think wireless services and part bundle industry the moving content continue to ancillary see I be you're to of forward. in

as have structure. of play engine, dynamic, that fashion AT&T. under a to content captive so don't said umbrella a in managing effectively do things we And of of prudent overall earlier, will a think as in to our I overall number I cost necessarily speak, we'll that allow now it part the promotional us flexible

Amir Rozwadowski

for for much the again With results. your and very conclude Thanks our everyone, to the participation connecting And look question, call interest in you, we'll quarter AT&T. that, Walt. post forward thank and fourth

Operator

that conference Teleconference for Thank gentlemen, And today. your ladies you Services. does conclude Special for and your and using AT&T for participation

You disconnect. may now

AT&T (T) 20 Oct 222022 Q3 Earnings call transcript