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Will AT&T Continue Its Earnings Growth in Q2 2018?

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AT&T’s earnings in the second quarter

AT&T (T) is expected to report its results for the second quarter on July 24. In this series, we’ll take a look at the expectations for AT&T’s performance in the quarter. Wall Street analysts expect the company’s earnings to rise. They expect AT&T’s adjusted EPS to reach ~$0.85 in the quarter compared to $0.79 in the second quarter of 2017.

In the first quarter, AT&T reported adjusted EPS of $0.85. While the company missed analysts’ consensus earnings estimate of $0.87, its adjusted EPS rose ~14.9% YoY (year-over-year) from $0.74.

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During the first quarter, AT&T gained 2.6 million net new wireless customers in the United States, with gains seen in its prepaid, postpaid, and connected devices. This improvement could be significant given that smaller competitors Sprint (S) and T-Mobile (TMUS) have made much of their ability to steal customers from other mobile carriers. AT&T lost 22,000 postpaid phone subscribers in the first quarter.

Peer comparison

In comparison, Verizon’s (VZ) adjusted EPS rose ~23.2% YoY to reach $1.17 in the first quarter, whereas T-Mobile’s EPS fell ~2.5% YoY to $0.78. Meanwhile, Sprint’s EPS improved from -$0.07 in the fiscal fourth quarter of 2016 to $0.02 in the fiscal fourth quarter of 2017 (which ended in March 2018).

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In the next article, we’ll look at how much total revenue growth we can expect from AT&T in the second quarter.

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