AT&T Q2 Profit Tops Estimates on Strong Subscriber Growth; Shares Rise

AT&T (NYSE: T) reported second-quarter financial results that exceeded Wall Street's profit expectations, fueled by accelerating subscriber growth across its fiber and wireless segments. The company's stock rose approximately 2.5% in pre-market trading on Wednesday following the announcement.

Q2 Financial Highlights

AT&T posted adjusted earnings per share (EPS) of $0.65, surpassing the consensus analyst estimate of $0.59. The company's revenue for the quarter was $31.6 billion, a 2.3% increase year-over-year, which was roughly in line with the consensus forecast of $31.8 billion.

Key financial metrics from the report include:

• Adjusted EBITDA: Rose 5.2% to $12.3 billion.
• Free Cash Flow: Increased to $4.7 billion, up from $4.4 billion in the same period last year.
• Capital Investment: Totaled $6.1 billion for the quarter.

Subscriber Growth Powers Performance

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The strong bottom-line performance was driven by significant gains in the company's Advanced Connectivity division. AT&T added over 1 million customers in this segment, with service revenue climbing 5.1% to $23.5 billion and operating income surging 20.3% to $7.3 billion.

Subscriber net additions were a bright spot for investors. The company reported 432,000 postpaid phone net adds, a critical metric for the wireless industry, while maintaining a low postpaid phone churn rate of 0.86%. In its internet business, AT&T added 367,000 fiber subscribers and 279,000 fixed wireless subscribers.

Outlook and Fiber Expansion

Looking ahead, AT&T reaffirmed its full-year 2026 guidance. The company continues to project an adjusted EPS in the range of $2.25 to $2.35, compared to a market consensus of $2.32.

The company also highlighted progress in its long-term fiber buildout, adding over 1 million new fiber locations in the quarter to reach a total of 38.6 million. AT&T stated it remains on track to pass over 40 million fiber locations by the end of 2026.