AT&T sees earnings growth over next 3 years; eyes more than $40B in anticipated shareholder returns

AT&T anticipates earnings growth over the next three years thanks to the momentum of 5G and fiber services.

The company also announced Tuesday that it expects its improved financial performance to support more than $40 billion of anticipated shareholder returns through dividends and stock buybacks over the same time. This includes an initial $10 billion stock repurchase that it expects to complete by the end of 2026.

“Over the last four years, we’ve achieved durable and profitable subscriber growth, generated attractive returns on network investment, and strengthened our balance sheet,” AT&T CEO John Stankey said in a statement.

Shares of AT&T rose about 3% before the market open.

The Dallas company said that it's looking to expand its fiber broadband network to more than 50 million locations by the end of 2029. It is actively working to exit its legacy copper network operations across the large majority of its wireline footprint by the end of of that year as well.

AT&T said that it expects to have largely completed the modernization of its 5G wireless network with open technology by 2027, with deep mid-band 5G spectrum covering more than 300 million people by the end of 2026. The company said that the network will be able to support super-fast download speeds and serve as a platform for new product and GenAI innovation.

AT&T now anticipates 2024 adjusted earnings in a range of $2.20 to $2.25 per share. Its prior outlook was for $2.15 to $2.25 per share.

Analysts polled by FactSet expect full-year earnings of $2.21 per share.

For 2025, AT&T is calling for adjusted earnings of $1.97 to $2.07 per share, excluding DirecTV. It foresees adjusted earnings per share accelerating to double-digit percentage growth in 2027.

Free cash flow is expected to total more than $16 billion next year, excluding DirecTV. AT&T predicts annual growth of approximately $1 billion, resulting in free cash flow of more than $18 billion in 2027.

AT&T sold a 30% stake of DirecTV to private equity firm TPG in 2021 for $16.25 billion. It is now in the process of selling its remaining 70% stake in DirecTV to TPG for about $7.6 billion, which is expected to close next year.