AT&T’s Mobility and Business Solutions
In this series, we will look at AT&T’s (T) mobile and wireline strategies as well as the company’s short- to medium-term guidance. The telecom company recently discussed these strategies in an analyst conference after the DIRECTV (DTV) acquisition.
In this part, we will look at a new division that the company has structured. In 2Q15, the company’s two largest reported segments were wireless and wireline. Business Solutions was the biggest subsegment of the wireline division. However, the company has structured a new segment: Mobility and Business Solutions. This division has both wireless and wireline components. This division is significantly larger than Consumer Mobility, another new segment.
According to the company, Mobility and Business Solutions is an annual revenue source exceeding $70 billion. The same figure for Consumer Mobility is larger than $30 billion. As we can see in the chart above, Mobility and Business Solutions has more than 3.5 million customers in about 200 countries. Also, its business sales force exceeds 10,000 individuals.
AT&T is the largest US telecom company by market capitalization. As of August 21, 2015, it is the second-largest telecom company in the world after China Mobile (CHL) by market capitalization.
AT&T has the largest US wireline operation. It is second to Verizon (VZ) in wireless in terms of revenue, as well as the total base of postpaid and prepaid customers in 2Q15. AT&T also owns the largest satellite TV provider in the US: DIRECTV.
You may take exposure on AT&T while diversifying risk by investing in the iShares MSCI USA Minimum Volatility ETF (USMV) or the iShares Russell 1000 Growth ETF (IWF). USMV held ~1.7% in the telecom company as of July 31, 2015. AT&T contributed to ~0.3% of IWF’s holdings on the same date.