AT&T Q2 EPS Beats Expectations with Strong Subscriber Growth, but Revenue Falls Slightly Short
Taylor Wilson
AT&T posted Q2 adjusted EPS of $0.65, beating estimates by $0.06, and added 432,000 postpaid phone subscribers — far above the Street's ~325,000 forecast. Revenue of $31.56 billion missed by ~$250 million, and SpaceX's looming entry remains a core valuation overhang.
Profit beat, revenue miss — what happened?
Adjusted EPS came in at $0.65, topping consensus by $0.06. Adjusted EBITDA — earnings before interest, taxes, depreciation, and amortization — hit $12.3 billion, also slightly above expectations.
Revenue rose 2.3% year-over-year to $31.56 billion, missing analyst estimates by roughly $250 million.
This means → AT&T is getting more efficient at turning revenue into profit, but the top line itself is still struggling to keep pace with expectations.
Why is subscriber growth the standout number?
AT&T added 432,000 postpaid phone subscribers, nearly a third more than the Street's ~325,000 estimate.
Fiber, fixed wireless, and postpaid phone net additions all grew year-over-year. The company said it added over 1 million "premium connectivity" customers in the quarter.
In plain terms = growth is broad-based — not just phones but home broadband and wireless home internet too. That breadth is what reassures the market.
The bundle play — is cross-selling actually working?
AT&T launched a combined broadband-and-wireless pricing plan in March. Today, 42.5% of home broadband buyers also subscribe to its mobile service.
This means → cross-selling is gaining traction — nearly half of broadband users are now locked into a phone plan, lifting customer stickiness.
AT&T recently raised prices for some subscribers. In a fiercely competitive market, post-hike retention rates are the next metric to watch.
SpaceX wants in — how is AT&T defending?
Bloomberg reported that SpaceX is in talks with Charter Communications on a consumer mobile partnership. The Financial Times said in June that SpaceX has briefed investors on plans to offer mobile service directly to consumers.
In response, AT&T joined Verizon and T-Mobile in May to form a joint venture providing satellite connectivity to phone users — widely read as a defensive move against SpaceX.
Put simply = the Big Three are banding together on satellite because none of them wants to hand this market to Musk.
What should investors focus on now?
AT&T reaffirmed its long-term financial guidance through 2028, including a plan to return $45 billion to shareholders via dividends and buybacks over that period.
The subscriber beat has eased some competitive fears, but two questions remain open: revenue keeps missing estimates, and the SpaceX threat has not yet materialized.
This reflects a market caught between two narratives — improving profit efficiency on one side, and a potential revenue ceiling on the other.
Content is for reference only, not financial advice.