McElfresh reiterated that AT&T continues to take a disciplined and return-focused approach to growth and investment and made the following points:
The company continues to see healthy customer growth in its strategic focus areas of 5G and fiber as customer demand for connectivity services remains high. While the company continues to monitor the evolving economic backdrop, McElfresh noted that AT&T continues to execute well thanks to a high-quality network and a consistent go-to-market approach and additionally feels good about its ability to attract high-quality customers.
In addition, McElfresh added that he feels confident in the company’s strong value proposition, the resilient nature of its connectivity services and the sustainability of its wireless customer growth across multiple segments. He also said that he was pleased with the results from the company’s pricing actions made in the first half of 2022.
McElfresh said that as the company continues to lap investments made over the past two years, it is realizing additional cost efficiencies. He shared that benefits of cost reduction measures are increasingly falling to the bottom line and driving improvements in the company’s operating leverage.
AT&T remains committed to its guidance to achieve its target of 30 million-plus locations, including business locations, with fiber by the end of 2025. At the end of the third quarter of 2022, AT&T had the ability to serve 18.5 million consumer locations and approximately 3.0 million business customer locations in more than 100 metro areas with fiber. McElfresh said that AT&T Fiber continues to deliver the best customer experience in a competitive marketplace and he’s pleased with the momentum in first-year penetration rates of about two times greater than historical norms.
McElfresh indicated that AT&T expects full-year capital investment in the $24 billion range to meet growing demand for core connectivity, while also meeting full-year 2022 guidance for free cash flow in the $14 billion range. The company remains focused on investing in building a sustainable and durable connectivity operation with improved cash generation and continues to be pleased with the return profile of its fiber and 5G investments.
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