AT&T Inc. topped profit expectations for its latest quarter on Thursday, the last full period to contain results from the WarnerMedia business that the telecommunications company has since spun off.
Revenue fell to $38.1 billion from $43.9 billion, though the year-earlier total included results from the company’s U.S. video and Vrio businesses that have now been divested. Analysts tracked by FactSet were modeling $38.2 billion for the quarter.
The company recorded net income of $4.8 billion, or 65 cents a share, compared with $7.5 billion, or $1.02 a share, a year prior. After adjusting for merger-amortization costs and other items, AT&T
earned 77 cents a share, down from 85 cents a share a year prior but ahead of the FactSet consensus, which was for 62 cents a share.
The stock rose 1.1% in premarket trading Thursday.
AT&T officially spun out its WarnerMedia business April 8 in a combination with Discovery, and the company now plans to refocus its energy on the telecommunications side of the business.
“AT&T has entered a new era, meeting this opportunistic moment from a
position of flexibility and strength thanks to our evolving networks, enhanced
customer experience, growing 5G and fiber customer base and a much
stronger balance sheet,” Chief Executive John Stankey said in a release.
The company added a net of 691,000 postpaid phone subscribers in the quarter, which it said was its strongest first-quarter performance on the metric in more than a decade. The FactSet consensus was for 413,000 postpaid phone net additions. AT&T saw postpaid phone churn of 0.79% during the period.
Within its consumer wireline business, AT&T notched 289,000 fiber net additions.
Amid a heavy investment quarter, AT&T generated free-cash flow of $700 million. The company said that free-cash flow for standalone AT&T was $2.9 billion.
“Our results, including free-cash flow, are in line with our expectations toward delivering on the full-year guidance provided at our recent Analyst Day,” Stankey said in the release.
See more on AT&T’s analyst-day targets
Shares of AT&T have slipped 3.3% over the past three months as the S&P 500
has risen 1.4%.