On Wednesday, AT&T posted adjusted earnings of $0.65 per share and revenue of $31.6 billion for the second quarter.

  • AT&T generated $4.7 billion in free cash flow, exceeding its own guidance range of $4.0 billion to $4.5 billion, and higher than the $4.4 billion in the year-ago quarter. 
  • The company raised its 2026 share repurchase target to about $10 billion from $8 billion, accelerating buybacks planned through 2028.
  • The telecom company added over one million Advanced Connectivity customers, including 646,000 consumer and business internet subscribers, 367,000 fiber customers and 279,000 fixed wireless clients. 

AT&T Inc. (T) stock extended gains overnight after closing up 3.5% following its second-quarter (Q2) earnings results. 

While the company’s adjusted earnings of $0.65 per share exceeded Wall Street estimates of $0.59, revenue of $31.6 billion came in just below the consensus forecast of $31.8 billion.

Meanwhile, the company provided other key updates related to its cash flow position, share buybacks, and its views on competition with SpaceX’s (SPCX) Starlink, among others. 

Free Cash Flow Beat Guidance 

One of the biggest positives for the telecommunications giant in the quarter was its cash generation.

AT&T generated $4.7 billion in free cash flow, exceeding its own guidance range of $4.0 billion to $4.5 billion, and higher than the $4.4 billion in the year-ago quarter. 

Management also reaffirmed the company's expectation for more than $18 billion in free cash flow this year. “We expect free cash flow will be relatively stable year over year in the third quarter with strong year-over-year growth in the fourth quarter,” CFO Pascal Desroches said in the earnings call. 

Accelerating Share Buybacks 

AT&T returned $4.1 billion to shareholders during the second quarter, including $2.2 billion in share repurchases, and expects to buy back nearly $1 billion worth of stock in July. 

The company also raised its 2026 share repurchase target to about $10 billion from $8 billion, accelerating buybacks planned through 2028. 

“Together, our planned share repurchases and expected dividend payments will total approximately $18 billion this year, which is essentially 100% of our outlook for free cash flow,” Desroches said, adding that the company’s cash flow and liquidity can sustain the dividend and buybacks plans. 

Growth Acceleration Across Segments

The telecom conglomerate also demonstrated strong growth across its business. AT&T added over one million Advanced Connectivity customers, including 646,000 consumer and business internet subscribers, 367,000 fiber customers and 279,000 fixed wireless clients. 

The company also said that it added 432,000 postpaid phone subscribers while maintaining a postpaid phone churn rate of 0.86% compared to 0.89% in the previous quarter. The firm said that it remains on track to surpass 40 million fiber locations by the end of 2026 and 60 million by 2030.

CEO John Stankey said on the investor call that this was the “best-ever second quarter for AT&T fiber net adds and a record quarter for combined fiber and fixed wireless net adds.”

“At the end of the second quarter, 42.5% of our Advanced Home Internet customers also have a postpaid wireless account with AT&T. And this convergence rate reached 45% when excluding customers within our acquired footprint from Lumen. These are high lifetime value subscribers, and our strong customer growth is a key driver of our accelerated financial growth during the second quarter,” he added. 

Leveraging AI For Long-Term Gains

AT&T said its investment-led strategy is already driving stronger operating performance while positioning the company to meet the growing connectivity demands of AI. Management expects the rise of agentic AI, autonomous vehicles, robotics, drones, and augmented reality to significantly increase network traffic and require low-latency, high-bandwidth connections. 

“Agentic adoptionisprojectedtodrive approximately 9x growth in enterprise traffic and approximately 7x growth in consumer traffic by 2035,” Stankey said. 

“Distribution of AI inference to the edge necessitates low latency, and high bandwidth connectivity to access end points. This is why we believe fiber-enabled network convergence at the edge will create a true competitive advantage,” he added, noting that the company is already witnessing rapid increases in large-scale data traffic, which require high-capacity metro and intercity fiber infrastructure.

“By the end of this decade, we expect to operate the most advanced and technologically open communications network in the US, built on a foundation of dense interconnected metro fiber and deep nationwide spectrum. This is exactly the asset base we want as AI begins to shape the next era of connectivity, and I wouldn't trade our assets for anyone else's,” he said. 

No Threat From Starlink

Stankey addressed concerns about competition from SpaceX's (SPCX) Starlink in response to a question, reiterating that AT&T's strategy remains centered on fiber and its existing wireless network, while also adding that satellite services are not essential to the company's growth. 

Stankey said that while he sees fixed wireless as a useful solution for specific use cases, he said fiber remains the most optimal long-term technology for broadband.

In a separate interview with CNBC, he addressed similar concerns, saying, “There are going to be new competitors, and there are going to be folks that come in. But the reality is that they're coming to the game very late after this industry has been established. They have to catch up with substantial amounts of infrastructure investment that's been going on for decades.”

T Stock: What Does Retail Think?

On Stocktwits, retail sentiment around T stock improved from ‘bearish’ to ‘neutral’ territory over 24 hours as message volumes surged nearly 400%. 

One user said, “$T growth story is becoming a two-lane network play,” noting details about the company’s customer growth, cash flow outlook and share repurchase announcements. “The fiber + wireless convergence thesis is starting to show up in the numbers,” they said. 

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The stock is down about 6% so far in 2026. 

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