AT&T is playing the Fiber-Mobile Convergence game very well as these numbers show

Wednesday was not a good one for the "Big 3" US carriers on Wall Street. Once again, news about Starlink's acquisition of spectrum spooked investors and they sold off T-Mobile by $4.66 or 2.95%, taking it down to $153.09. Verizon closed at $43.48 for a loss of $1.06 or 2.38%, and AT&T skidded $1.51 or 6.45% to $21.91.
AT&T investors sell the stock despite releasing a strong Q3 earnings report

The analytical type of reader will notice that AT&T declined more than twice as much on a percentage basis as its rivals. That is most likely the fault of AT&T's third quarter earnings release. Even though there were some strong results for the three months, with Wall Street you usually buy the rumor and sell the news.
This has replaced net new postpaid subscribers as the "headline number" for carriers to report

As is typical these days, the most important metric in the release was the gain, for the second straight quarter, of more than one million Advanced Connectivity customers. The latter has replaced net new postpaid phone subscribers as the headline metric when reporting carrier results.





The reason why this is so important is that it includes the number of new customers taking advantage of connectivity across fiber, fixed wireless, and postpaid phones. As it turned out, the third quarter for AT&T included a strong increase in postpaid phone net adds along with accelerated internet net adds.

Internet net adds were 769,000. That included 442,000 fiber and 327,000 fixed wireless customers. Postpaid phone net adds were 379,000.
AT&T is playing the Fixed-Mobile Convergence game

Now you might be sitting there, saying to yourself, "Alan, how do strong accelerated internet net adds help AT&T's wireless service?" I happen to have the answer: according to the carrier, 42.8% of households with AT&T’s advanced home internet services also chose AT&T wireless.

AT&T was the first among the "Big 3" to double down on fiber, and it offers discounted unlimited postpaid wireless to convert broadband subscribers into mobile customers. These customers are pretty much locked into AT&T Wireless, as their mobile churn is lower than the churn number reported by mobile customers alone.
AT&T's Q3 revenue rose 5.2% year-over-year

For the quarter, AT&T generated revenue of $32.3 billion, up 5.2% from the $30.7 billion reported for last year's third quarter. The increase was the result of growth in Advanced Connectivity wireless service, equipment, and fiber revenues.
Operating income rose 18.9% to $7.6 billion. Postpaid phone churn was 0.92%, matching the rate for Q3 of last year. This is high and represents the percentage of AT&T's postpaid phone subscribers who said goodbye to AT&T during the quarter. A continuing high churn rate can indicate that the carrier is losing customers to rival "Big 3" firms or to MVNOs.

Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) rose 5.4% to $12.51 billion. The adjusted EBITDA margin barely rose to 38.7% from 38.6% a year ago.

Check out these great articles:

• AT&T claims a big 5G win over its rivals in new speed tests, but T-Mobile triumphs where it matters
• AT&T is killing off its ancient copper network faster than ever — here’s why

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