AT&T Inc Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: John Hodulik - UBS Securities LLC - Analyst : Great. Thanks, guys. John, maybe a couple of quick regulatory questions for you. First of all, on the regulatory filing about the legacy products, are there any direct cost savings that would come with this, that you could potentially see in '25 if that's successful? And I think this is probably the first step in terms of heading towards a decommissioning of that copper infrastructure. How would you expect the sort of steps to proceed if you're successful with that filing? So that's number one. And then number two, on tax reform. One, just what's your view on the chance of getting that through? And you mentioned that you could go a little faster with some of the CapEx. Would that be a '25 issue or '26? And what are some of the areas do you think that you could do more spending and accelerate the plan? Thanks.

Question: David Barden - BofA Global Research (US) - Analyst : Hey, guys. Thanks so much for taking the questions. I guess my first one for you, John, just returning to a topic that we discussed on the Analyst Day, which was this notion of home games and away games and the benefits the fiber brings to the Mobile business. I'm noticing in the fourth quarter that the gains in Mobile net adds among fiber customers was equal to the total net adds for the quarter and about probably 22%, 23% of gross adds. Is that something -- is there some information value in examining how those pieces fit together? And then the second question, if I could, Pascal, this Reign real estate deal and the $850 million it's contributing, I guess the question is going to be was that -- was knowing that that's coming part of the $16 billion, or is it part of the plus? And how do we think about maybe as we decommission the copper plant, especially, future real estate deals contributing to this cash flow picture? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 27, 2025 / 1:30PM, T.N - Q4 2024 AT&T Inc Earnings Call

Question: David Barden - BofA Global Research (US) - Analyst : All right, helpful. Thank you, guys, both. Appreciate it.

Question: Michael Rollins - Citi - Analyst : Thanks, and good morning. You used the same or similar language around the healthy wireless market and a further normalization of net add and activity levels. Curious if you could just put some additional context around that, how that -- they look similar or different than last year in terms of characteristics -- and how AT&T is looking at the mix between volume growth and ARPU opportunity within the '25 guidance. And just one other quick item, in the trending schedule, you added a much larger number of resale subs. I think it was up 13.5% quarter on quarter. I'm just curious what drove that performance? And does reseller become a more significant component of Mobility service revenue growth during 2025? Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 27, 2025 / 1:30PM, T.N - Q4 2024 AT&T Inc Earnings Call

Question: Benjamin Swinburne - Morgan Stanley & Co. LLC - Analyst : Thanks. Good morning. Question on fiber and one on Mobility. Pascal, I think you mentioned maybe some pent-up demand benefited the fourth quarter coming off the labor strikes at the end of Q3. Any ability to size that for us? And then I'm curious, you guys had really strong fiber ARPU growth in the fourth quarter and the year. We've seen some of our cable competitors get more aggressive with their own converged offers. It doesn't seem like that's having any impact. But I'm just wondering if you could talk a little bit about your confidence in fiber ARPU growth heading into '25. And then just on Mobility, great churn results. Any update on sort of how you're thinking about gross adds and whether that can maybe inflect positive in '25 as Jen and the team kind of put a lot of their initiatives into place. Thanks so much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 27, 2025 / 1:30PM, T.N - Q4 2024 AT&T Inc Earnings Call

Question: Benjamin Swinburne - Morgan Stanley & Co. LLC - Analyst : Great. Thanks so much.

Question: Peter Supino - Wolfe Research - Analyst : Hey, good morning, everybody. A question on upgrades and one on immigration. On upgrades, I'm not going to ask you about iPhone innovation. I'm wondering if you could comment on just the average age of the phones in your customer fleet in the postpaid phone business, and maybe describe directionally how that number has evolved and whether we're approaching an inflection point for upgrade simply based on aging as we get into the middle of the 5G cycle here. And then on immigration, if you could comment on the sensitivity of your postpaid phone business to potential major changes in immigration statistics over the next couple of years after the change in the administration. Thank you.

Question: Jim Schneider - Goldman Sachs & Company, Inc. - Analyst : Good morning. Thanks for taking my question. I was wondering if you could maybe expand, John, on your earlier comments around the broadband market and the competitive trends within it. I mean, clearly, some of your competitors in the cable space are getting a little bit more aggressive on pricing. It sounds like you don't see the need to follow that. But I'm just sort of curious whether you expect there to be sort of more opportunities for jump balls or a little bit more kind of competition within the sort of existing non-home movers in the market going into 2025. And then separately, on the Business Wireline outlook, that's a relatively muted outlook, not different from what you talked about in 2024. But I'm wondering if you see any opportunities on the horizon here that could jump-start sort of top-line opportunities, whether that's from a fiber connectivity for AI or otherwise. I think you'd sort of moderate those EBITDA declines sooner rather than later. Thank you.

Question: Sebastiano Petti - JPMorgan - Analyst : Hi, thank you for taking the question. I guess maybe, John, kind of sticking with business, but from the wireless side, obviously, you broke out the wireless service revenue growth, maybe outperformed consolidated Mobility growth on the business side. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 27, 2025 / 1:30PM, T.N - Q4 2024 AT&T Inc Earnings Call Can you maybe pack -- unpack a little bit of what you're seeing in that market, John, obviously, against the context of the broader industry and normalization there? At the Analyst Day, you did outline that AT&T does have a share opportunity, given your mix of customers across the board in the Fortune 1000 and how you see that evolving. But you also -- it seems like there's tailwinds in that business as well, whether it be from corporate liable, maybe demand growing. So it'd be helpful if you could perhaps unpack that and how you're thinking about that evolving over a multiyear basis within AT&T. Thank you.

Question: Tim Horan - Oppenheimer & Co., Inc. - Analyst : Thanks, guys. You've been pretty early in migrating your operations and networks to the cloud and open source. I'm sure you've seen DeepSeek has created a much lower-cost large language model out there. Can you maybe just give us your thoughts on using cloud and AI to both improve relationships with customers, improve your product, and lowering your overall expenses? And then maybe just the same thing on your infrastructure, just any updated thoughts, how you can use your infrastructure to support AI? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 27, 2025 / 1:30PM, T.N - Q4 2024 AT&T Inc Earnings Call