Summary
AT&T Inc. reported its first quarter 2018 results, showing a slight decrease in total operating revenues to $38.04 billion from $39.37 billion in the prior year, primarily due to a significant drop in service revenues. This decline in service revenue was largely attributed to the adoption of new revenue recognition accounting standards (ASC 606) and a shift by customers towards unlimited wireless plans. However, equipment revenues saw a substantial increase of 51.0% to $4.39 billion, driven by higher device sales and upgrades, also influenced by the new accounting standards. Net income attributable to AT&T increased by 34.4% to $4.66 billion, resulting in diluted earnings per share of $0.75, up from $0.56 in the first quarter of 2017. This improvement in profitability was significantly aided by a lower effective tax rate following the Tax Cuts and Jobs Act of 2017. The company's strategic initiatives, including segment realignments and the ongoing pursuit of the Time Warner acquisition, remain key focus areas. The company ended the quarter with a solid cash position of $48.87 billion.
Financial Highlights
48 data points| Revenue | $38.04B |
| SG&A Expenses | $7.90B |
| Operating Expenses | $31.84B |
| Operating Income | $6.20B |
| Interest Expense | $1.77B |
| Net Income | $4.66B |
| EPS (Basic) | $0.75 |
| EPS (Diluted) | $0.75 |
| Shares Outstanding (Basic) | 6.16B |
| Shares Outstanding (Diluted) | 6.18B |
Key Highlights
- 1Total operating revenues decreased by 3.4% to $38.04 billion, primarily driven by a 7.7% decline in service revenues, influenced by new accounting standards and unlimited plan adoption.
- 2Equipment revenues surged by 51.0% to $4.39 billion, boosted by increased device sales and upgrades, also benefiting from new accounting interpretations.
- 3Net income attributable to AT&T grew by 34.4% to $4.66 billion, with diluted EPS rising to $0.75 from $0.56 year-over-year.
- 4The effective tax rate decreased significantly to 22.5% from 33.5% due to the Tax Cuts and Jobs Act of 2017.
- 5Total debt increased to $163.05 billion ($29.32 billion current portion), with the debt ratio at 52.6%.
- 6The company continued to invest in capital expenditures, totaling $5.96 billion for property and equipment purchases, supporting network upgrades.
- 7The pending acquisition of Time Warner Inc. remains a significant strategic focus, with ongoing litigation and an extended termination date of June 21, 2018.