AT&T's Q3 Net Income Skyrockets to $9.3B Amid Revenue Growth, Cost Cuts

TL;DR

**AT&T is back, baby! Net income exploded, and they're buying back stock – time to go long.**

AI Summary

AT&T Inc. reported a significant financial turnaround for the nine months ended September 30, 2025, with net income attributable to AT&T soaring to $18,165 million, a substantial increase from $6,868 million in the prior year. Basic earnings per share attributable to common stock also dramatically improved to $2.51, up from $0.93. Total operating revenues grew to $92,182 million, a 2.38% increase from $90,038 million in 2024, driven by both service revenue ($75,766 million) and equipment revenue ($16,416 million). Operating expenses decreased by 3.28% to $73,808 million, largely due to a reduction in asset impairments and abandonments and restructuring costs from $5,061 million in 2024 to $504 million in 2025. The company also saw a substantial increase in cash and cash equivalents, reaching $20,272 million as of September 30, 2025, compared to $3,298 million at December 31, 2024. A new stock repurchase program authorized in December 2024 led to the repurchase of approximately 87 million shares totaling $2,444 million. The enactment of the One Big Beautiful Bill Act on July 4, 2025, is expected to materially decrease cash taxes paid, contributing to a $3,467 million current tax asset. Long-term debt increased to $128,090 million from $118,443 million at year-end 2024.

Why It Matters

This filing signals a strong operational and financial rebound for AT&T, which is crucial for investors seeking stability and growth in a competitive telecom market dominated by rivals like Verizon and T-Mobile. The significant increase in net income and EPS, coupled with a substantial reduction in restructuring costs, suggests improved efficiency and a clearer strategic direction. For employees, this could mean greater job security and potential for growth as the company strengthens its financial position. Customers might benefit from continued investment in network infrastructure and services, driven by increased cash flow. The broader market will watch if AT&T can sustain this momentum, potentially influencing sector valuations and investor confidence in legacy telecom giants.

Risk Assessment

Risk Level: medium — While AT&T shows strong financial performance with net income attributable to common stock at $18,137 million for the nine months ended September 30, 2025, up from $6,715 million in 2024, the company's long-term debt increased to $128,090 million from $118,443 million at December 31, 2024. This increase in debt, alongside a significant increase in debt maturing within one year to $11,378 million from $5,089 million, indicates a reliance on debt financing that could pose risks if interest rates rise or cash flow generation falters.

Analyst Insight

Investors should consider AT&T's improved profitability and strategic share repurchases as positive indicators. However, they should closely monitor the company's increasing debt levels, particularly the short-term maturities, and assess its ability to manage these obligations in a rising interest rate environment. A balanced approach, perhaps holding existing positions while watching for further debt reduction, is advisable.

Financial Highlights

debt To Equity

N/A

revenue

$92.182B

operating Margin

19.95%

total Assets

N/A

total Debt

$128.090B

net Income

$18.165B

eps

$2.51

gross Margin

N/A

cash Position

$20.272B

revenue Growth

+2.38%

Revenue Breakdown

Key Numbers

• $18.165B — Net Income Attributable to AT&T (Increased from $6,868 million in 2024 for the nine months ended September 30, 2025.)
• $2.51 — Basic Earnings Per Share Attributable to Common Stock (Increased from $0.93 in 2024 for the nine months ended September 30, 2025.)
• $92.182B — Total Operating Revenues (Increased from $90,038 million in 2024 for the nine months ended September 30, 2025.)
• $73.808B — Total Operating Expenses (Decreased from $76,315 million in 2024 for the nine months ended September 30, 2025.)
• $504M — Asset Impairments and Abandonments and Restructuring (Significantly decreased from $5,061 million in 2024 for the nine months ended September 30, 2025.)
• $20.272B — Cash and Cash Equivalents (Increased from $3,298 million at December 31, 2024, as of September 30, 2025.)
• $128.090B — Long-Term Debt (Increased from $118,443 million at December 31, 2024, as of September 30, 2025.)
• $11.378B — Debt Maturing Within One Year (Increased from $5,089 million at December 31, 2024, as of September 30, 2025.)
• $2.444B — Common Stock Repurchases (Amount spent on repurchasing approximately 87 million shares for the nine months ended September 30, 2025.)
• $3.467B — Current Tax Assets (Included in 'Prepaid and other current assets' at September 30, 2025, due to new tax legislation.)

Key Players & Entities

• AT&T Inc. (company) — primary filer of the 10-Q
• New York Stock Exchange (regulator) — exchange where AT&T's securities are registered
• SEC (regulator) — regulator for the 10-Q filing
• Bloomberg (company) — publisher of the analysis
• Verizon (company) — competitor in the telecom market
• T-Mobile (company) — competitor in the telecom market
• Financial Accounting Standards Board (regulator) — issuer of ASU No. 2025-06
• Inflation Reduction Act of 2022 (regulator) — legislation imposing excise tax on stock repurchases
• One Big Beautiful Bill Act (regulator) — new tax legislation enacted July 4, 2025
• Rule 10b5-1 (regulator) — SEC rule for open market repurchase programs

FAQ

Risk Factors

• Long-Term Debt Increase [medium — financial]: Long-term debt increased to $128,090 million from $118,443 million at year-end 2024. This increase, coupled with a rise in debt maturing within one year to $11,378 million from $5,089 million, could strain liquidity and increase interest expenses.
• Tax Legislation Impact [low — regulatory]: The enactment of the 'One Big Beautiful Bill Act' on July 4, 2025, is expected to materially decrease cash taxes paid. While beneficial, changes in tax laws can introduce complexity and potential future adjustments.
• Asset Impairments and Restructuring Costs [low — operational]: A significant decrease in asset impairments and abandonments and restructuring costs from $5,061 million in 2024 to $504 million in 2025 indicates a more stable operational environment, but the potential for future restructuring remains.
• Competitive Market Landscape [high — market]: AT&T operates in highly competitive telecommunications and technology industries, facing pressure from both established players and emerging technologies. This requires continuous investment in network upgrades and service innovation.
• Stock Repurchase Program [medium — financial]: The company repurchased approximately 87 million shares totaling $2,444 million under a new $10,000 million authorization. While this can boost EPS, it reduces cash available for other investments or debt reduction.

Industry Context

AT&T operates in the highly competitive telecommunications and technology sectors, characterized by rapid technological advancements and evolving consumer demands. Key trends include the ongoing build-out of 5G networks, increasing demand for high-speed broadband, and the convergence of communication and entertainment services. The industry faces significant capital expenditure requirements for network infrastructure and ongoing pressure to innovate services.

Regulatory Implications

The telecommunications industry is subject to extensive regulation concerning spectrum allocation, net neutrality, data privacy, and consumer protection. The recent 'One Big Beautiful Bill Act' highlights the dynamic nature of tax legislation, which can significantly impact a company's financial performance. AT&T must navigate these regulatory landscapes to ensure compliance and manage potential risks.

What Investors Should Do

1. Monitor debt levels and interest coverage ratios.
2. Evaluate the sustainability of improved operating margins.
3. Assess the impact of the 'One Big Beautiful Bill Act' on future tax liabilities.
4. Analyze the effectiveness of the stock repurchase program.

Key Dates

• 2025-07-04: Enactment of the One Big Beautiful Bill Act — Expected to materially decrease cash taxes paid, contributing to a current tax asset of $3,467 million.
• 2024-12-01: Authorization of new stock repurchase program — Authorized repurchase of up to $10,000 million of AT&T common stock, leading to $2,444 million in repurchases by September 30, 2025.
• 2025-09-30: End of the nine-month reporting period — Key period for financial performance review, showing significant net income growth and improved EPS.
• 2024-12-31: Year-end 2024 — Baseline for comparison of financial metrics, including cash position and long-term debt.

Glossary

Operating Revenues

The total income generated from the company's primary business operations, including service and equipment sales. (Indicates the overall scale and top-line performance of AT&T.)

Operating Expenses

Costs incurred in the normal course of business operations, excluding interest and taxes. (Key to understanding the company's cost structure and operational efficiency.)

Asset Impairments and Abandonments and Restructuring

Costs recognized when the carrying value of an asset exceeds its recoverable amount or when a business unit is restructured or closed. (A significant decrease in these costs contributed to improved profitability in the current period.)

Cash and Cash Equivalents

Highly liquid investments with maturities of three months or less at the time of purchase. (Represents the company's immediate liquidity and ability to meet short-term obligations.)

Long-Term Debt

Debt obligations that are due more than one year from the balance sheet date. (Indicates the company's long-term leverage and financial obligations.)

Current Tax Assets

Represents future tax benefits, such as net operating loss carryforwards or tax credits, that are expected to reduce future tax payments. (The 'One Big Beautiful Bill Act' created a significant current tax asset for AT&T.)

Noncontrolling Interest

The portion of equity in a subsidiary that is not attributable to the parent company. (Reflects the ownership stake of others in AT&T's consolidated entities.)

Year-Over-Year Comparison

AT&T has demonstrated a significant financial turnaround for the nine months ended September 30, 2025, compared to the same period in 2024. Total operating revenues increased by 2.38% to $92,182 million, driven by growth in both service and equipment revenues. Most notably, net income attributable to AT&T surged to $18,165 million from $6,868 million, and basic EPS improved to $2.51 from $0.93. This dramatic improvement was largely due to a substantial decrease in operating expenses, primarily from lower asset impairments and restructuring costs, which fell from $5,061 million to $504 million. The company also significantly strengthened its liquidity, with cash and cash equivalents rising to $20,272 million from $3,298 million.

Key Financial Figures

• $1.00 — ch registered Common Shares (Par Value $1.00 Per Share) T New York Stock Exchange N

Filing Documents

• t-20250930.htm (10-Q) — 2421KB
• exhibit1013q25.htm (EX-10.1) — 615KB
• exhibit3113q25.htm (EX-31.1) — 10KB
• exhibit3123q25.htm (EX-31.2) — 10KB
• exhibit323q25.htm (EX-32) — 8KB
• 0000732717-25-000171.txt ( ) — 12077KB
• t-20250930.xsd (EX-101.SCH) — 57KB
• t-20250930_cal.xml (EX-101.CAL) — 84KB
• t-20250930_def.xml (EX-101.DEF) — 387KB
• t-20250930_lab.xml (EX-101.LAB) — 681KB
• t-20250930_pre.xml (EX-101.PRE) — 512KB
• t-20250930_htm.xml (XML) — 2285KB

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements AT&T INC. CONSOLIDATED STATEMENTS OF INCOME Dollars in millions except per share amounts (Unaudited) Three months ended Nine months ended September 30, September 30, 2025 2024 2025 2024 Operating Revenues Service $ 25,336 $ 25,134 $ 75,766 $ 74,982 Equipment 5,373 5,079 16,416 15,056 Total operating revenues 30,709 30,213 92,182 90,038 Operating Expenses Cost of revenues Equipment 5,468 4,933 16,900 14,891 Other cost of revenues (exclusive of depreciation and amortization shown separately below) 6,351 6,697 19,102 20,135 Selling, general and administrative 7,454 6,958 21,544 21,022 Asset impairments and abandonments and restructuring — 4,422 504 5,061 Depreciation and amortization 5,317 5,087 15,758 15,206 Total operating expenses 24,590 28,097 73,808 76,315 Operating Income 6,119 2,116 18,374 13,723 Other Income (Expense) Interest expense ( 1,700 ) ( 1,675 ) ( 5,013 ) ( 5,098 ) Equity in net income (loss) of affiliates ( 20 ) 272 1,905 915 Other income (expense) — net 6,254 717 7,476 1,850 Total other income (expense) 4,534 ( 686 ) 4,368 ( 2,333 ) Income Before Income Taxes 10,653 1,430 22,742 11,390 Income tax expense 976 1,285 3,512 3,545 Net Income 9,677 145 19,230 7,845 Net Income Attributable to Noncontrolling Interest ( 363 ) ( 319 ) ( 1,065 ) ( 977 ) Net Income (Loss) Attributable to AT&T $ 9,314 $ ( 174 ) $ 18,165 $ 6,868 Preferred Stock Dividends and Redemption Gain ( 36 ) ( 52 ) ( 28 ) ( 153 ) Net Income (Loss) Attributable to Common Stock $ 9,278 $ ( 226 ) $ 18,137 $ 6,715 Basic Earnings (Loss) Per Share Attributable to Common Stock $ 1.29 $ ( 0.03 ) $ 2.51 $ 0.93 Diluted Earnings (Loss) Per Share Attributable to Common Stock $ 1.29 $ ( 0.03 ) $ 2.51 $ 0.93 Weighted Average Number of Common Shares Outstanding — Basic (in millions) 7,156 7,202 7,193 7,197 Weighted Average Number of Common Shares Outstanding — with Dilution (in millions) 7,169 7,208 7,203 7,200 See Note

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Dollars in millions except per share amounts NOTE 1. PREPARATION OF INTERIM FINANCIAL STATEMENTS Basis of Presentation Throughout this document, AT&T Inc. is referred to as "we," "AT&T" or the "Company." The consolidated financial statements include the accounts of the Company and subsidiaries and affiliates which we control. AT&T is a holding company whose subsidiaries and affiliates operate worldwide in the telecommunications and technology industries. You should read this document in conjunction with the consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2024. The results for the interim periods are not necessarily indicative of those for the full year. These consolidated financial statements include all adjustments that are necessary to present fairly the results for the presented interim periods, consisting of normal recurring accruals and other items. The consolidated financial statements include our controlled subsidiaries, as well as variable interest entities (VIE) where we are deemed to be the primary beneficiary. All significant intercompany transactions are eliminated in consolidation. Investments in entities that we do not control but have significant influence are accounted for under the equity method. The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions, including estimates of fair value, probable losses and expenses, that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Certain prior period amounts have been conformed to the current period's presentation providing further disaggregation of activities within Cash from Operations in our consolidated statements of cash flows and additional revenue categories for our Busi

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued Dollars in millions except per share amounts NOTE 2. EARNINGS PER SHARE A reconciliation of the numerators and denominators of basic and diluted earnings per share is shown in the table below: Three months ended Nine months ended September 30, September 30, 2025 2024 2025 2024 Numerators Numerator for basic earnings per share: Net Income (Loss) Attributable to Common Stock $ 9,278 $ ( 226 ) $ 18,137 $ 6,715 Dilutive impact of share-based payment 3 — 9 — Numerator for diluted earnings per share $ 9,281 $ ( 226 ) $ 18,146 $ 6,715 Denominators (000,000) Denominator for basic earnings per share: Weighted average number of common shares outstanding 7,156 7,202 7,193 7,197 Dilutive impact of share-based payment (in shares) 13 6 10 3 Denominator for diluted earnings per share 7,169 7,208 7,203 7,200 NOTE 3. OTHER COMPREHENSIVE INCOME Changes in the balances of each component included in accumulated other comprehensive income (OCI) are presented below. All amounts are net of tax. Foreign Currency Translation Adjustment Net Unrealized Gains (Losses) on Securities Net Unrealized Gains (Losses) on Derivative Instruments Defined Benefit Postretirement Plans Accumulated Other Comprehensive Income (Loss) Balance as of December 31, 2024 $ ( 1,755 ) $ ( 46 ) $ ( 604 ) $ 3,200 $ 795 Other comprehensive income (loss) before reclassifications 287 20 ( 722 ) — ( 415 ) Amounts reclassified from accumulated OCI — 1 4 1 33 2 ( 1,065 ) 3 ( 1,028 ) Net other comprehensive income (loss) 287 24 ( 689 ) ( 1,065 ) ( 1,443 ) Balance as of September 30, 2025 $ ( 1,468 ) $ ( 22 ) $ ( 1,293 ) $ 2,135 $ ( 648 ) Foreign Currency Translation Adjustment Net Unrealized Gains (Losses) on Securities Net Unrealized Gains (Losses) on Derivative Instruments Defined Benefit Postretirement Plans Accumulated Other Comprehensive Income (Loss) Balance as of December 31, 2023 $ ( 1,337 ) $ ( 57 ) $ ( 1,029

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued Dollars in millions except per share amounts NOTE 4. SEGMENT INFORMATION Our segments are comprised of strategic business units or other operations that offer products and services to different customer segments over various technology platforms and/or in different geographies that are managed accordingly. We have two reportable segments: Communications and Latin America. Our chief operating decision maker (CODM) is our Chairman of the Board, Chief Executive Officer and President. Our CODM uses operating income to evaluate performance and allocate resources, including capital allocations, when managing the business. Our CODM manages operations through the review of actual and forecasted "Operations and Support Expenses" information at a segment and business unit level, with Communications and Latin America segments primarily evaluated on a direct cost basis and comprised of equipment, compensation, network and technology, sales, advertising and other costs. Additionally, business unit expenses within the Communications segment include direct and shared costs. Direct costs are incurred in support of products and services offered by the business units, such as equipment costs (predominantly wireless devices), network access, rents, leases, sales support, customer provisioning and commission expenses. Shared costs amongst the business units generally include information technology, network engineering and construction costs, advertising and other general and administrative expenses. The Communications segment provides wireless and wireline telecom and broadband services to consumers located in the U.S. and businesses globally. Our business strategies reflect integrated product offerings that cut across product lines and utilize shared assets. This segment contains the following business units: Mobility provides nationwide wireless service and equipment. Business Wireline provides advanced e

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued Dollars in millions except per share amounts For the three months ended September 30, 2025 Revenues Operations and Support Expenses Depreciation and Amortization Operating Income (Loss) Communications Mobility $ 21,713 $ 12,011 $ 2,577 $ 7,125 Business Wireline 4,248 3,067 1,535 ( 354 ) Consumer Wireline 3,555 2,266 964 325 Total Communications 29,516 17,344 5,076 7,096 Latin America 1,095 896 177 22 Segment Total 30,611 18,240 5,253 7,118 Corporate and Other Corporate: DTV-related retained costs — 56 50 ( 106 ) Parent administration support 3 386 4 ( 387 ) Securitization fees 29 150 — ( 121 ) Value portfolio 66 16 — 50 Total Corporate 98 608 54 ( 564 ) Certain significant items — 425 10 ( 435 ) Total Corporate and Other 98 1,033 64 ( 999 ) AT&T Inc. $ 30,709 $ 19,273 $ 5,317 $ 6,119 For the three months ended September 30, 2024 Revenues Operations and Support Expenses Depreciation and Amortization Operating Income (Loss) Communications Mobility $ 21,052 $ 11,559 $ 2,490 $ 7,003 Business Wireline 4,606 3,250 1,399 ( 43 ) Consumer Wireline 3,416 2,296 924 196 Total Communications 29,074 17,105 4,813 7,156 Latin America 1,022 854 158 10 Segment

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