AT&T : Title AT&T Reports Fourth-Quarter and Full-Year Results

Consolidated Financial Results

AT&T's consolidated revenues for the fourth quarter totaled $46.8 billion (~$48.0 billion excluding HBO Max investment) versus $48.0 billion in the year-ago quarter.Growth in domestic wireless services and strategic and managed business services revenues partially offset declines in revenues from domestic video, legacy wireline services and WarnerMedia. Without the impact of foreign exchange pressures and HBO Max investments in the form of foregone WarnerMedia content licensing revenues, consolidated revenues would have increased in both the fourth quarter and the full year.

Operating expenses were $41.5 billion versus $41.8 billion in the year-ago quarter, down 0.8% due to lower Entertainment Group costs, lower intangible asset amortization and cost efficiencies, partially offset by the write-off of certain copper facilities.

Operating income was $5.3 billion versus $6.2 billion in the year-ago quarter, due to a $1.3 billion write-off of certain copper facilities, with operating income margin of 11.4% versus 12.8%. When adjusting for amortization, merger- and integration-related expenses, write-off of certain copper facilities and other items, operating income was $9.2 billion versus $9.4 billion in the year-ago quarter, and operating income margin was 19.6%, the same as the year-ago quarter.

Fourth-quarter net income attributable to common stock was $2.4 billion, or $0.33 per diluted common share, versus $4.9 billion, or $0.66 per diluted common share, in the year-ago quarter. Adjusting for $0.56, which includes merger-amortization costs, the write-off of certain copper facilities, a non-cash actuarial loss on benefit plans, merger- and integration-related expenses and other items, earnings per diluted common share was $0.89 compared to an adjusted $0.86 in the year-ago quarter.

Cash from operating activities was $11.9 billion, and capital expenditures were $3.8 billion. Capital investment - which consists of capital expenditures plus cash payments for vendor financing - totaled $4.2 billion, which includes about $450 million of cash payments for vendor financing and $900 million of FirstNet reimbursements. Free cash flow - cash from operating activities minus capital expenditures - was $8.2 billion for the quarter.

The company completed or announced about $9 billion in non-core asset monetizations in the fourth quarter. For the full year, the company closed about $18 billion of net asset monetizations, including working capital initiatives. Net debt was reduced by $7.6 billion in the quarter and reduced by $20.3 billion for the full year. Net-debt-to-adjusted EBITDA at the end of the fourth quarter was about 2.5x.

In addition to its investments to further improve and expand operations, AT&T continues to use its cash to return substantial value to shareholders through dividends and share retirements. In the fourth quarter, dividends paid totaled $3.7 billion. During the fourth quarter, AT&T began retiring shares under its outstanding share repurchase authorization. In the quarter, the company repurchased 51 million of its common shares for $2.0 billion.