AT&T Inc. (NYSE:T) announced financial results for its fiscal first quarter of 2026 on Wednesday.

The telecom giant reported operating revenues of $31.51 billion, a 2.9% increase from the same period last year, beating the analyst consensus estimate of $31.25 billion.

Adjusted earnings per share (EPS) stood at 57 cents, topping the analyst consensus estimate of 55 cents.

Growth was primarily driven by higher wireless and fiber revenue in Advanced Connectivity, including two months of contribution from customers added through the Lumen deal.

Revenue in Mexico also increased due to favorable foreign exchange movements in the first quarter of 2026.

However, declines in legacy services partially offset these gains, as demand fell while the company continued to phase out its copper-based network.

AT&T added more wireless subscribers than expected in the quarter, driven by strong demand for bundled plans that combine wireless and high-speed fiber services.

To stay competitive, telecom providers have expanded device subsidies, offered plan discounts, and increased spending on network infrastructure to attract and retain customers.

AT&T, like T-Mobile US, Inc. (NASDAQ:TMUS), continued offering device subsidies for Apple Inc.’s (NASDAQ:AAPL) latest iPhone models during the quarter to compete for users.

The company also adjusted its pricing strategy by raising rates on its lowest and highest wireless tiers while lowering prices in the middle, aiming to guide customers toward mid-range plans rather than trigger a broader price war, Reuters reported on Wednesday.

Key Segments

Earlier in 2026, AT&T introduced a new reporting structure with three segments: Advanced Connectivity, Legacy, and Latin America.

Revenue in Advanced Connectivity—the company’s largest segment—grew 4.7%, supported by higher service and equipment sales.

In contrast, Legacy revenue fell 25.3% as demand declined during the ongoing shutdown of its copper network.

Meanwhile, Latin America revenue increased 20.8%, driven in part by favorable foreign exchange movements.

The company added 584,000 new high-speed internet customers, with about half using its fiber network and the other half using its wireless home internet.

Consumer advanced home internet net adds totaled 512,000, including 273,000 fiber and 239,000 internet air customers.

AT&T reported 294,000 postpaid phone net additions, a decrease from 324,000 in the prior year. Analysts polled by FactSet had expected 272,000, Reuters reported.

AT&T’s postpaid phone churn, a measure of customer attrition, increased to 0.89% from 0.83% the previous year, while prepaid churn rose to 2.62% from 2.55%.

The company said 42% of households that use AT&T fiber also opted for their wireless service. 

Financial Highlights

Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) increased to $11.8 billion from $11.5 billion in the year-ago quarter.

The company’s net income fell to $3.8 billion, down from $4.4 billion in the year-ago quarter.

Operating cash flow declined to $7.6 billion from $9.0 billion in the same quarter last year, resulting in free cash flow of $2.5 billion, down from $3.1 billion, reflecting higher capital investment as the company accelerates its fiber deployment.

Capital expenditures for the quarter were $4.9 billion.

AT&T Outlook

For 2026–2028, the company reiterated low-single-digit annual service revenue growth.

The company reaffirmed adjusted EBITDA growth of 3% to 4% in 2026, then sees that improving to 5% or better by 2028 as gains in Advanced Connectivity more than offset declines in Legacy.

AT&T reiterated adjusted EPS of $2.25 to $2.35 in 2026 (versus an analyst consensus estimate of $2.29) and a double-digit three-year CAGR through 2028.

AT&T also reaffirmed its annual capital investment of $23 billion to $24 billion from 2026 through 2028.

It reiterated free cash flow of $18 billion or more in 2026, $19 billion or more in 2027, and $21 billion or more in 2028.

AT&T reaffirmed Advanced Connectivity service revenue to grow in the mid-single digits each year, including 5%+ growth in 2026.

The company also reiterated Advanced Connectivity EBITDA growth in the mid-to-high single digits annually, including 6%+ growth in 2026.

Meanwhile, AT&T reaffirmed its forecast of a decline in Legacy service revenue of over 20% in 2026.

AT&T has expanded its fiber network to over 37 million consumer and business locations and expects to surpass 40 million by year-end and exceed 60 million by 2030.

AT&T Dividend And Buyback

Regarding capital returns, AT&T reiterated plans to return more than $45 billion to shareholders from 2026 to 2028 through dividends and buybacks.

The company reiterated its plans to maintain its current annualized dividend of $1.11 per share and to repurchase approximately $8 billion in shares.

T Price Action: AT&T shares were down 2.16% at $25.32 during premarket trading on Wednesday, according to Benzinga Pro data.

Photo via Shutterstock