AT&T Reports Financial Results
Wednesday, January 29, 2020 | Comments

AT&T reported fourth quarter and full-year 2019 financial results. AT&T's consolidated revenues for the fourth quarter totaled $46.8 billion versus $48 billion in the year-ago quarter. Growth in domestic wireless services and strategic and managed business services revenues partially offset declines in revenues from domestic video, legacy wireline services and WarnerMedia.

“Our 2020 outlook positions us to deliver meaningful progress on our three-year financial and capital allocation plans as we continue to invest in growth opportunities and create value for our owners, as we did last year,” said Randall Stephenson, AT&T chairman and CEO.

In AT&T’s Mobility Group, which includes the First Responder Network Authority (FirstNet) service, service revenues were up 1.8% in the fourth quarter and 1.9% for the full year. Total wireless revenues including equipment were up 0.8% in the quarter and for the year. Operating income was up 1.5%, and FirstNet coverage is more than 75% completed, the company said.

AT&T’s Mexico operating loss improved by nearly $200 million.

Operating expenses were $41.5 billion versus $41.8 billion in the year-ago quarter, down 0.8% because of lower Entertainment Group costs, lower intangible asset amortization and cost efficiencies, partially offset by the write-off of certain copper facilities.

Operating income was $5.3 billion versus $6.2 billion in the year-ago quarter because of a $1.3 billion write-off of certain copper facilities, with operating income margin of 11.4% versus 12.8%.

Fourth-quarter net income attributable to common stock was $2.4 billion versus $4.9 billion in the year-ago quarter. Cash from operating activities was $11.9 billion, and capital expenditures were $3.8 billion. Capital investment, which consists of capital expenditures plus cash payments for vendor financing, totaled $4.2 billion, which includes about $450 million of cash payments for vendor financing and $900 million of FirstNet reimbursements.

Free cash flow — cash from operating activities minus capital expenditures — was $8.2 billion for the quarter.

The company completed or announced about $9 billion in non-core asset monetizations in the fourth quarter. For the full year, the company closed about $18 billion of net asset monetizations, including working capital initiatives. Net debt was reduced by $7.6 billion in the quarter and reduced by $20.3 billion for the full year.

For full-year 2019 when compared with 2018 results, AT&T's consolidated revenues totaled $181.2 billion versus $170.8 billion. The increase in revenues from a full year of Time Warner and growth in domestic wireless services, strategic and managed services, and IP broadband revenues were partially offset by declines in revenues from legacy wireline services and video. Operating expenses were $153.2 billion compared with $144.7 billion, primarily due to a full year of Time Warner and the write-off of certain copper facilities, partially offset by lower Entertainment Group costs, lower domestic wireless equipment costs, lower intangible asset amortization and cost efficiencies.

Versus results from 2018, operating income was $28 billion, up 7.1% primarily due to a full year of Time Warner in 2019, partially offset by the write-off of certain copper facilities. With adjustments for both years, operating income was $38.6 billion versus $35.2 billion in 2018, and operating income margin was 21.3% versus 20.6%.

2019 net income attributable to common stock was $13.9 billion versus $19.4 billion. AT&T's full-year cash from operating activities was $48.7 billion versus $43.6 billion in 2018. Gross capital investment, which includes capital expenditures, cash payments for vendor financing and FirstNet spending, was $23.7 billion. Capital investment, which consists of capital expenditures plus cash payments for vendor financing, totaled $22.7 billion, which includes $3 billion of cash payments for vendor financing.

Full-year free cash flow was $29 billion compared with $22.4 billion in 2018, up 30%.

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