Pascal Desroches to Update Shareholders at Deutsche Bank Media, Internet & Telecom Conference on March 11

Rhea-AI Summary

AT&T (NYSE:T) has announced that CFO Pascal Desroches will provide a shareholder update at the Deutsche Bank Media, Internet & Telecom Conference on March 11. The company confirms it remains on track with its 2025 financial guidance, expecting:

- Full-year adjusted EPS of $1.97 to $2.07, with Q1 at $0.48 or higher
- Full-year free cash flow of $16 billion+, with Q1 at $2.8 billion or higher
- Net leverage target of 2.5x net-debt-to-adjusted EBITDA by H1 2025

Additionally, AT&T expects to receive $1.4 to $1.5 billion in Q1 2025 from DIRECTV payments related to its 70% stake sale to TPG, with total after-tax payments of $5.4 billion expected in 2025 and $500 million in 2029. The company has also received over $850 million from a real estate sale-leaseback deal with Reign Capital.

Positive

• Strong Q1 2025 free cash flow projection of $2.8B+
• Expected receipt of $1.4-1.5B cash payment from DIRECTV sale in Q1
• Additional $850M+ cash proceeds from real estate sale-leaseback
• On track to meet 2025 financial guidance

Negative

• DIRECTV will be excluded from reported free cash flow and adjusted EPS starting 2025

Insights

Financial Analyst

AT&T's CFO confirmation that the company remains on track to meet all its 2025 financial targets represents stability in execution during a period of strategic transformation. The projected Q1 free cash flow of $2.8 billion or higher demonstrates AT&T's continued strong cash generation capabilities while maintaining its capital allocation priorities.

The upcoming cash infusions are particularly noteworthy. AT&T expects $1.4-1.5 billion from DIRECTV in Q1 related to its stake sale to TPG, with total after-tax payments reaching $5.4 billion in 2025. Additionally, the $850+ million already received from the Reign Capital real estate transaction further strengthens AT&T's balance sheet without impacting operational free cash flow metrics.

AT&T's confidence in achieving its net leverage target of 2.5x in H1 2025 shows management's commitment to debt reduction while maintaining shareholder returns. The Q1 EPS guidance of $0.48 or higher indicates earnings stability despite the DIRECTV accounting change.

This update reinforces AT&T's transformation into a focused connectivity provider with improving financial fundamentals. The company continues balancing network investments with shareholder returns while systematically reducing leverage and divesting non-core assets, providing a clearer investment profile for long-term shareholders.

DALLAS, March 10, 2025 /PRNewswire/ -- Tomorrow, AT&T's chief financial officer will participate in a fireside chat where he will discuss the Company's multi-year strategic growth plan.

Key Takeaways:

• AT&T is embarking on a multi-year strategic growth plan that centers around putting customers first and continued network investment.
• AT&T continues to make progress on becoming the best connectivity provider in America and remains on track to meet all of the financial and operational guidance and capital allocation plans shared during its fourth quarter 2024 earnings conference call and its 2024 Analyst & Investor Day.
• AT&T expects to report strong free cash flow in the first quarter as well as the receipt of more than $2 billion in cash proceeds and payments related to previously announced transactions.

Pascal Desroches, chief financial officer, AT&T Inc. (NYSE:T), will speak tomorrow at the Deutsche Bank Media, Internet & Telecom Conference where he will provide an update to shareholders.

AT&T remains on track to achieve its 2025 consolidated financial guidance and deliver on its multi-year outlook

AT&T remains on track to meet all of the 2025 and multi-year financial and operational guidance and capital allocation plans shared during its fourth quarter 2024 earnings conference call and at its 2024 Analyst & Investor Day.

As previously disclosed, beginning in 2025, AT&T's reported free cash flow and adjusted EPS will exclude DIRECTV. The Company has provided a recast of historical results for these two financial measures in its Form 8-K dated December 3, 2024.

The Company continues to expect full-year adjusted EPS of $1.97 to $2.07 and expects first-quarter adjusted EPS of approximately $0.48, or higher. This would result in adjusted EPS in the first quarter of 2025 that is consistent with, or better than, the first quarter of 2024, when excluding DIRECTV from the prior year.

The Company continues to expect full-year free cash flow of $16 billion+ and expects first-quarter free cash flow of approximately $2.8 billion, or higher. This would result in free cash flow in the first quarter of 2025 that is consistent with, or better than, the first quarter of 2024, when excluding DIRECTV from the prior year.

In addition, during the first quarter of 2025, AT&T expects to receive approximately $1.4 to $1.5 billion of cash payments from DIRECTV related to its agreement to sell its 70% stake in DIRECTV to TPG. The Company continues to expect to close the sale by mid-2025, and to receive total after-tax cash payments related to this transaction of $5.4 billion in 2025, as well as after-tax cash payments of $500 million in 2029.

In the first quarter, the Company also received more than $850 million in cash proceeds from the previously announced structured sale-leaseback of real estate to Reign Capital. Cash received related to the DIRECTV and Reign Capital transactions are not included in AT&T's free cash flow.

The Company continues to expect to achieve its net leverage target of net-debt-to-adjusted EBITDA in the 2.5x range in the first half of 2025 and maintain leverage within this range through 2027.

Conference details and more are available on the AT&T Investor Relations website

Full conference details are posted on the AT&T Investor Relations website, including a replay of the webcast. To automatically receive AT&T financial news by email, please subscribe to email alerts.

Non-GAAP Measures and Reconciliations to GAAP Measures Adjusted diluted EPS is calculated by excluding from operating revenues, operating expenses, other income (expenses) and income tax expense, certain significant items that are non-operational or non-recurring in nature, including dispositions and merger integration and transaction costs, actuarial gains and losses, significant abandonments and impairments, benefit-related gains and losses, employee separation and other material gains and losses. The tax impact of adjusting items is calculated using the effective tax rate during the quarter except for adjustments that, given their magnitude, can drive a change in the effective tax rate, in these cases, we use the actual tax expense or combined marginal rate of approximately 25%. The Company expects adjustments to 2025 reported diluted EPS to include an adjustment to remove equity in net income of DIRECTV, a non-cash mark-to-market benefit plan gain/loss, and other items. The adjustment to remove the equity in net income of DIRECTV is dependent upon cash distributions from DIRECTV and the timing of the closing of the sale of our DIRECTV investment, which is expected in mid-2025. The Company expects the mark-to-market adjustment, which is driven by interest rates and investment returns that are not reasonably estimable at this time, to be a significant item. Our projected first-quarter and full-year 2025 adjusted EPS depends on future levels of revenues and expenses, most of which are not reasonably estimable at this time. Accordingly, we cannot provide a reconciliation between this projected non-GAAP metric and the most comparable GAAP metric without unreasonable effort.

Free cash flow is defined as cash from operations minus cash flows related to our DIRECTV equity method investment (cash distributions less cash taxes paid from DIRECTV), minus capital expenditures and cash paid for vendor financing (classified as financing activities). First-quarter 2025 projected free cash flow of $2.8 billion, or higher, includes cash from operations of approximately $8.4 - $8.6 billion, minus approximately $1.4 - $1.5 billion of cash flows related to DIRECTV, which includes a special distribution of $1.138 billion, minus approximately $3.9 - $4.1 billion of capital expenditures and $0.2 billion of cash paid for vendor financing. Due to high variability and difficulty in predicting items that impact cash from operating activities, capital expenditures and vendor financing payments, the Company is not able to provide a reconciliation between full-year 2025 projected free cash flow and the most comparable GAAP metric without unreasonable effort.

Cautionary Language Concerning Forward-Looking Statements

Information set forth in this news release contains financial estimates and other forward-looking statements that are subject to risks and uncertainties, and actual results might differ materially. A discussion of factors that may affect future results is contained in AT&T's filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update and revise statements contained in this news release based on new information or otherwise. This news release may contain certain non-GAAP financial measures. The Company cannot provide a reconciliation between projected net debt-to-adjusted EBITDA and the most comparable GAAP metrics and related ratios without unreasonable effort. Reconciliations between the non-GAAP financial measures and the GAAP financial measures are available below and on the company's website at investors.att.com.

About AT&T

We help more than 100 million U.S. families, friends and neighbors, plus nearly 2.5 million businesses, connect to greater possibility. From the first phone call 140+ years ago to our 5G wireless and multi-gig internet offerings today, we @ATT innovate to improve lives. For more information about AT&T Inc. (NYSE:T), please visit us at about.att.com. Investors can learn more at investors.att.com.

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SOURCE AT&T

FAQ

What is AT&T's (T) expected free cash flow guidance for 2025?

AT&T expects full-year free cash flow of $16 billion+ for 2025, with Q1 projected at $2.8 billion or higher.

How much will AT&T (T) receive from the DIRECTV stake sale to TPG?

AT&T expects total after-tax cash payments of $5.4 billion in 2025 and an additional $500 million in 2029 from the sale of its 70% stake in DIRECTV.

What is AT&T's (T) adjusted EPS guidance for 2025?

AT&T projects full-year 2025 adjusted EPS of $1.97 to $2.07, with Q1 expected at $0.48 or higher.

When does AT&T (T) expect to reach its net leverage target?

AT&T aims to achieve its net-debt-to-adjusted EBITDA target of 2.5x in the first half of 2025.