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Why AT&T Expects Reduced Capex Spending in the Coming Years

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AT&T’s capex spending

AT&T (T) has been investing big in capex to improve its network. Its management expects gross capex of ~$23 billion in 2019 compared to ~$25 billion in 2018.

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AT&T at the conference

During the JPMorgan Global Technology, Media and Communications Conference last week, Randall Stephenson, AT&T’s chair and CEO, spoke about the company’s capital spending plans. Stephenson stated that AT&T’s capital spending rate is expected to have a downward bias in the coming years as non-5G spending in various areas decreases.

These areas include Mexico LTE network deployment, which was largely completed at the end of 2018, and AT&T’s fiber footprint, which is expected to reach its targeted 14 million homes by the end of June. AT&T is expected to reach its target of the virtualization of 75% of network functions by the end of 2020.

AT&T is focusing on network function virtualization and software-defined networking technologies to achieve rapid service delivery along with the efficient utilization of its capital.

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