Summary
AT&T Inc.'s third quarter and year-to-date 2015 performance reflects the significant impact of the DIRECTV acquisition, which closed on July 24, 2015. Consolidated operating revenues saw substantial increases, driven by the inclusion of DIRECTV's results and growth in Mexico's wireless operations, though legacy product declines persisted. Net income attributable to AT&T decreased compared to the prior year periods, impacted by increased operating expenses, including broadcast/programming costs and amortization from recent acquisitions. Financially, the company saw an increase in debt, with the debt ratio rising significantly, primarily due to the financing of the DIRECTV acquisition. Cash flow from operations remained strong, but investing activities showed a significant outflow due to acquisitions and capital expenditures. The company is prioritizing debt reduction with its free cash flow following the DIRECTV merger. Overall, AT&T is navigating a dynamic market with strategic acquisitions and ongoing investments in its network infrastructure, while managing the integration of a major new business segment.
Financial Highlights
47 data points| Revenue | $39.09B |
| SG&A Expenses | $9.11B |
| Operating Expenses | $33.17B |
| Operating Income | $5.92B |
| Interest Expense | $1.15B |
| Net Income | $2.99B |
| EPS (Basic) | $0.50 |
| EPS (Diluted) | $0.50 |
| Shares Outstanding (Basic) | 5.92B |
| Shares Outstanding (Diluted) | 5.94B |
Key Highlights
- 1Consolidated operating revenues increased by 18.6% for the third quarter and 6.8% for the nine months ended September 30, 2015, largely driven by the acquisition of DIRECTV and growth in Mexican wireless operations.
- 2Net income attributable to AT&T decreased by 4.3% for the third quarter and 10.6% for the nine months ended September 30, 2015, compared to the prior year.
- 3The company significantly increased its long-term debt, with the debt ratio rising to 50.8% as of September 30, 2015, up from 43.9% at the end of 2014, primarily to finance the DIRECTV acquisition.
- 4Cash flow provided by operating activities increased to $26.7 billion for the first nine months of 2015, up from $25.6 billion in the prior year, supported by the DIRECTV acquisition's contribution.
- 5Investing activities showed a substantial net cash used of $43.0 billion for the first nine months of 2015, heavily influenced by acquisitions (including DIRECTV, Nextel Mexico, and GSF Telecom) and spectrum license purchases.
- 6The company reported a new segment, 'Entertainment and Internet Services,' significantly boosted by the DIRECTV acquisition, contributing $10.9 billion in revenue for the third quarter.
- 7Depreciation and amortization expense increased by 38.0% for the third quarter, driven by amortization of intangibles from recent acquisitions and increased depreciation from new assets, including those from DIRECTV.