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Highlights:
- $40 Billion Shareholder Returns: AT&T plans to return over $40 billion to shareholders through dividends and share repurchases over the next three years.
- Major Fibre Expansion: The company aims to reach 50 million fibre locations by 2029, supported by organic growth and partnerships.
- Sustained Financial Growth: AT&T projects annual adjusted EBITDA growth of 3% or more from 2025 to 2027, with increasing free cash flow targets.
AT&T (NYSE:T), one of the United States' largest telecom providers, has announced a bold strategic plan during its 2024 analyst and investor day presentation. The multi-year roadmap outlines ambitious growth targets in its fibre and 5G networks, alongside substantial returns to shareholders.
Fibre Expansion to 50 Million Locations
Central to AT&T’s strategy is the expansion of its fibre network to 50 million locations by 2029. This ambitious target includes organic growth of 45 million locations and an additional 5 million locations through partnerships, such as its joint venture with BlackRock, known as Gigapower, and collaborations with commercial open-access providers.
By modernising its infrastructure, the company seeks to provide faster internet speeds and expand its market presence in urban, suburban, and rural areas.
5G Network Modernisation
AT&T also aims to complete the modernisation of its 5G wireless network by 2027. This enhancement is expected to deliver super-fast download speeds and improve customer experience, cementing its position as a leader in wireless connectivity.
Financial Targets and Shareholder Returns
AT&T’s chief executive, John Stankey, underscored the company’s commitment to growth and shareholder value. Over the next three years, the telecom giant plans to return more than $40 billion to shareholders through dividends and share repurchases.
The company provided optimistic financial guidance, including:
- Adjusted EBITDA growth of around 3% for 2024.
- Free cash flow of $15 billion in 2024, excluding its investment in DIRECTV, which it expects to exit next year.
- From 2025 to 2027, annual adjusted EBITDA growth of at least 3% and free cash flow of $16 billion or more by 2025.
Stankey described the strategy as ushering in "a new era of sustained growth at AT&T."
Stock Market Reaction
Following the announcement, AT&T’s stock rose by 4.1%, reaching $23.63 by midday trading on Tuesday. Investors responded positively to the company’s long-term vision and commitment to delivering value.
Positioning for the Future
With this strategic plan, AT&T is not only reinforcing its role as a telecom leader but also setting itself up for sustained growth in a competitive market. By focusing on network expansion, shareholder returns, and financial resilience, AT&T aims to navigate industry challenges while capturing new opportunities in fibre and 5G connectivity.
