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AT&T earnings preview: Will Q2 results exceed expectations?

AT&T (T) is scheduled to announce its June quarter earnings results on July 24 after the market close. Most of the analysts are looking for the telecom veteran to post upbeat earnings for the recently concluded quarter while predicting a decline in revenue. Wireless and entertainment group additions would be the main focus of the […]

July 20, 2018 2 min read
Market News

AT&T (T) is scheduled to announce its June quarter earnings results on July 24 after the market close. Most of the analysts are looking for the telecom veteran to post upbeat earnings for the recently concluded quarter while predicting a decline in revenue. Wireless and entertainment group additions would be the main focus of the […]

· July 20, 2018

AT&T (T) is scheduled to announce its June quarter earnings results on July 24 after the market close. Most of the analysts are looking for the telecom veteran to post upbeat earnings for the recently concluded quarter while predicting a decline in revenue. Wireless and entertainment group additions would be the main focus of the investors.

In the recent first-quarter, the telecom giant posted a 34% jump in earnings driven by the actuarial gain on benefit plans and costs for amortization, merger- and integration-related expenses. However, revenues dropped 3.4% due to declines in legacy wireline services, domestic video, and wireless service revenues.

At the end of the first quarter, AT&T had about 55 million business wireless subscribers. Total video subscribers grew by 125,000 and the Entertainment Group ended the quarter with 25.4 million total video subscribers. DIRECTV NOW added 312,000 subscribers to reach nearly 1.5 million customers.

Related: AT&T reports Q1 2018 results; misses estimates

With regard to the AT&T-Time Warner merger, a federal appeals court approved the US Justice Department’s request for an accelerated schedule for an appeal of a judge’s ruling. The legal briefs must be closed by October 18. The department fears that the merged company will have the ability to raise its rivals’ costs and stifle growth on next-gen entrants.

For the second quarter, market analysts expect the company to report a 7.6% increase in earnings and a 1.1% decline in revenue. In the past four quarters, the company’s earnings missed Street’s expectations for two times, while beating predictions for two times. Majority of the analysts are recommending a HOLD rating on the stock.

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Shares of AT&T closed Thursday’s regular trading session down 1.39% at $31.27 on the NYSE and reached a new 52-week low ($31.04) during Friday’s morning trading session.

Related: DOJ unwilling to let go, plans appeal against AT&T-Time Warner deal

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