Postpaid and fiber growth fuel Q1 gains as AT&T homes in on 30 million-location fiber milestone
AT&T kicked off 2025 on strong footing, reporting robust financial and operational performance in the first quarter and reaffirming its full-year guidance, citing growth across its 5G mobility and fiber broadband businesses.
The telco posted revenues of $30.6 billion in Q1, up 2% year-over-year, driven by gains in mobility and consumer wireline services. Net income rose to $4.7 billion, and adjusted earnings per share came in at $0.51, compared to $0.48 a year ago. Adjusted EBITDA reached $11.5 billion and free cash flow increased to $3.1 billion.
Mobility momentum continues
AT&T’s Mobility business remained a key growth driver, with 324,000 postpaid phone net adds in Q1 and service revenue rising 4.1% year over year to $16.7 billion. Total wireless revenue reached $21.6 billion, up 4.7%, thanks in part to a 6.9% increase in equipment sales and higher average revenue per user (ARPU), which grew 1.8% to $56.56.
Postpaid phone churn was 0.83%, up slightly from 0.72% a year ago, while total postpaid churn was 0.99%. Despite this modest uptick, AT&T maintained its competitive edge through customer loyalty initiatives and network investments. Mobility EBITDA grew 3.5% year-over-year to $9.3 billion. “This increase was primarily driven by the normalization of customers reaching the end of their equipment promotional financing periods in the fourth quarter,” commented AT&T Chief Financial Officer and Senior Executive Vice President Pascal Desroches on a call with media and investors.
In comparison, Verizon reported postpaid phone losses totaled 356,000 for the quarter — a contrast that has left some asking if AT&T is luring customers away from Verizon.
Fiber fuels consumer growth
Consumer Wireline posted strong results on the back of continued fiber expansion. The telco added 261,000 AT&T Fiber customers, marking 21 straight quarters with more than 200,000 fiber net adds. AT&T Internet Air, its fixed wireless broadband service, also contributed 181,000 net adds.
Overall, Consumer Wireline revenue increased 5.1% to $3.5 billion, and EBITDA surged 18.6% to $1.3 billion. Broadband average revenue per user rose 7.4% to $70.87, with fiber-specific ARPU up 6.2%.
“A little over three years ago, we set a target of passing over 30 million total locations with our fiber network by the end of 2025,” recalled CEO John. “I’m proud to say that we expect to achieve that target before mid-year as we continue to ramp towards our objective of reaching 50 million-plus total locations with fiber by 2029.” He added that is being achived through a combination of the compan’ys organic build and the commercial open-access agreements it’s entered with Gigapower and third-party fiber companies.
AT&T now passes 29.5 million consumer and business locations with fiber. Notably, more than 40% of AT&T Fiber customers also subscribe to AT&T Mobility, highlighting the company’s focus on convergence.
324,000 postpaid phone net adds during the quarter, in addition to 261,000 AT&T Fiber net adds.
Tariff impact unknown
While Desroches commented on the call that AT&T has seen a flurry of handset upgrades in response to tariffs, the larger effect remains unknown. Stankey said the company is monitoring tariff developments closely and acknowledged potential impacts on equipment pricing and demand.
“Like others, we’re closely monitoring this journey to rebalance global trade. And its impact on the broader economy. The announced tariffs could potentially increase the cost of smartphones and other devices, as well as the cost of network and technical equipment. The magnitude of any increase will depend on a variety of factors including how much of the tariffs our vendors pass on, the impact that the tariffs have on consumer and business demand,” he continued.
Mixed results in business segment
Business Wireline remained a weak spot, with revenue declining 9.1% year over year to $4.5 billion due to ongoing pressure on legacy services. Operating income fell to a loss of $98 million, compared to a $64 million gain last year.
According to Desroches, the drop was mainly tied to pressures on legacy and transitional offerings. “This was partially offset by growth in fiber and advanced connectivity services, which grew 4.5%. About one-third of these revenues are from value-added services, which are variable on a quarterly basis. The remaining two-thirds, which is predominantly fiber connectivity, is growing at a faster rate and accelerated relative to the fourth quarter,” he said.
Staying the course
The company also reiterated its expectation to complete the sale of its 70% stake in DIRECTV to TPG by mid-2025.
“The message here is that the primary driver of our growth is our success at executing our fiber and 5G playbook, and that our increased investments in customer acquisition and retention, our driving sustained growth in high value customer relationships,” summarized Stankey. “The fundamentals of our business are very strong. And we continue to feel confident that our strategy and plans for 2025 are on track.”
