AT&T's fourth quarter results highlighted the company's future around fiber and fixed wireless access (FWA) and its gradual pivot away from legacy copper services and infrastructure.
AT&T posted solid fiber and fixed wireless access (FWA) subscriber gains in the fourth quarter amid a recent greenlight from the Federal Communications Commission (FCC) for AT&T to start the shutdown of legacy copper services in a portion of the telco's wire centers.
The operator tacked on another 307,000 consumer fiber subscribers in Q4 2024, improved from a gain of 273,000 in the year-ago quarter. AT&T's Q4 fiber subscriber gain was better than the 259,000 expected by analysts.
The company's Q4 fiber results benefitted from some pent-up demand coming by way of a one-month work stoppage in the southeast portion of the country during the third quarter, AT&T CEO John Stankey noted on Monday's earnings call.
AT&T, which has a plan underway to extend fiber to 50 million fiber locations by the end of 2029, ended 2024 with 9.33 million fiber subscribers.
Playing to AT&T's convergence strategy, the company said 40% of its fiber customers also get mobile services from AT&T, up from 38.8% in the year-ago quarter.
AT&T also added 123,000 residential customers for Internet Air, an FWA product the company is using primarily to "catch" DSL customers. With business customers included, AT&T added 158,000 Internet Air subs, better than the 134,000 expected by analysts. AT&T ended 2024 with more than 650,000 Internet Air subs.
With Internet Air results included, AT&T said it added 123,000 consumer broadband customers in the quarter, up from a gain of 19,000 in the year-ago period, ending the year with 13.98 million. However, AT&T shed about 51,000 wireline consumer broadband customers in Q4 when losses from legacy U-verse and DSL were included.
Fiber and general broadband average revenue per unit (ARPU) continues to climb as customers shift to higher speed tiers and a portion of the base upgrades to fiber. AT&T said overall broadband ARPU rose 6.2% to $69.69 while fiber ARPU rose 4.7% to $71.71.
AT&T to detail plan to shut down 1,300 wire centers
AT&T said it is making progress on its plan to shut down copper-based services across most of its US footprint (save for California) by the end of 2029. To help spur that transition, AT&T developed a new POTS replacement called AT&T Phone-Advanced that can run on fiber or wireless networks.
Stankey noted that AT&T has received FCC approval to begin that copper shutdown process across a portion of its wire centers that house and support components such as the voice switch and to migrate those customers to the aforementioned replacement offering.
AT&T, Stankey noted, will "soon" submit detailed filings with the FCC about its plan to stop selling legacy copper products in about 1,300 wire centers, which account for about one-quarter of the wire centers in AT&T's footprint.
He said this initial focus on 1,300 wire centers will represent "the first scaled test" of AT&T's copper retirement framework.
"This was an important first step to establish a template that supports a deliberate and planned transition to a more capable and modern communications infrastructure," Stankey said. "We look forward to working with the [Brendan] Carr FCC to accelerate and advance policies and actions that stimulate investment in modernization of the US communications infrastructure."
Financial snapshot
AT&T posted consolidated Q4 2024 revenues of $32.30 billion, better than the $32.07 billion expected by analysts. Service revenues rose 0.3% to $25.15 billion and total operating revenues were up 0.9% to $32.29 billion.
Aided by fiber and FWA subscriber growth, consumer wireline revenues jumped 3.4% to $3.46 billion. However, business wireline services dropped 10% to $32.29 billion as AT&T continued to see a decline in legacy services.
Mobility revenues rose 3.3% to $23.12 billion. AT&T's gain of 839,000 postpaid mobile subscribers outpaced a year-ago gain of 759,000 and was well above the 686,000 expected by analysts.
AT&T shares were up $1.26 (5.55%) to $23.98 each in Monday morning trading.