Every few months we get to see how companies are doing, and now it’s time to take a look at AT&T’s Q2 2016 earnings report. How is the 2nd largest USA cellular carrier doing this time around? Well, the numbers show good results, but things are still not looking as bright in some areas.
AT&T did add over 2.1 million subscribers, but that includes connected devices, prepaid users and their growth in Mexico (where they included 165,000 postpaid subscribers and 614,000 prepaid subscribers to reach nearly 10 million total wireless subscribers). These make for impressive stats, especially in Mexico, where AT&T is shaking the industry. Even Telcel (considered a monopoly) is changing its plans and prices after AT&T’s rapid growth south of the border.
These make for impressive stats, especially in Mexico, where AT&T is shaking the industry.
Once you strip those 3 elements out of the equation, the numbers don’t look as amazing. AT&T is said to have lost 180,000 postpaid US subscribers during said quarter. This is still an improvement over Q2 2015’s 270,000 and Q1 2016’s 363,000 lost subscribers, but that doesn’t change the fact that numbers continue to decrease.
We are also noticing the results of AT&T’s efforts to bring more smartphones to prepaid carriers and focus less on feature phones. The company added 800,000 smartphones, while losing 600,000 basic feature phones.
But despite some discrepancies, AT&T’s plan seems to be working out. The carrier reported an EBITDA (earnings before interest, taxes, depreciation and amortization) of $7.4 billion, while last year’s Q2 results show $7.3 billion. They also have more total subscribers this Q2 when compared to last: 77.6 vs 77.3 million.
But despite some discrepancies, AT&T's plan seems to be working out.
Only time will tell how AT&T will do in the USA, in the long run, but their strategy has certainly changed and we can now put them in another category. It will be hard to compare AT&T to other carriers considering they are focusing more on prepaid and international services. They have acquired both Iusacell and Nextel in Mexico, bringing the game to a whole different level.