The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Fortune Global 500

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Fortune 500

The 300 companies on this year’s list brought in over $12.6 trillion in revenue for the latest 12 months, with the median revenue figure at $22 billion.

America's Most Innovative Companies

Leaders in all industries rely more than ever on Big Tech—and appreciate the giants that deliver, at scale, without drama.

World's Most Admired Companies

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The 200 companies on this list are transforming industries from the inside out.

The 26th edition of the list shows how much esteem Big Tech giants command among other business leaders.

The 25th Fortune World’s Most Admired Companies list suggests that tech giants’ peers respect them as much as ever.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

GLOBAL-500-2023-ATT

The 300 companies on this list are transforming industries from the inside out.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500 2023-ATT

AT&amp;T falls 17 spots on this year’s list. The decline largely reflects the company’s 2021 divestiture of its Time Warner and DirectTV media and entertainment businesses; overall, revenue in 2022 was down 10% from the previous year. 
<ul> 
 	<li>AT&amp;T was able to draw more customers to its wireless phone business in 2022 with the help of discounts and trade-ins. In the last three months of 2022, AT&amp;T added more than 650,000 subscribers to one of the most lucrative parts of its business—postpaid phone ervice—outdoing some of its rivals.</li> 
 	<li>The company increased prices on its wireless plans in June 2022 to cope with inflationary pressures.</li> 
</ul>

Just as it dominates our economy, Big Tech now dominates Fortune’s annual ranking of corporate reputation.

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

G500 2022-32-AT&T

Having acquired Time Warner and DirecTV in an attempt to become a major media player, AT&amp;T spent much of 2021 dealing with the fact that the attempt had ultimately failed. It sold off its underperforming media businesses, merging them into a new company, Warner Bros. Discovery, while reaping some $40 billion in cash to help reduce its debt load. Overall, AT&amp;T shed 28,000 employees over the course of 2021, as well as 14.5% of its share price. Despite the setbacks, AT&amp;T’s core businesses fared well: Its fiber internet service ranked No. 1 in customer satisfaction in 2021 based on an American Customer Satisfaction Index survey. AT&amp;T added 3.2 million phone subscribers in 2021, a tally that exceeded its net new customers gained in the previous 10 years combined. AT&amp;T is now focused on growing its 5G network and fiber-optic footprint.

This year’s Fortune 500 marks the 68th running of the list.

F500 2022 AT&T

Having acquired Time Warner and DirecTV in 2018 in an attempt to become a major media player, AT&amp;T spent much of 2021 dealing with the fact that the attempt ultimately failed. It sold off its underperforming media businesses, merging them into a new company, Warner Bros. Discovery, while reaping some $40 billion in cash to help reduce its debt load. Overall, AT&amp;T shed 28,000 employees over the course of 2021, as well as 14.5% of its share price. Despite the setbacks, AT&amp;T’s core businesses fared well: Its fiber internet service ranked No. 1 in customer satisfaction in 2021 based on an American Customer Satisfaction Index survey. AT&amp;T added 3.2 million phone subscribers in 2021, a tally that exceeded its net new customers gained in the previous 10 years combined. AT&amp;T is now focused on growing its 5G network and fiber-optic footprint.

After a year in which humanity leaned more heavily than ever on tech giants, see which companies topped Fortune's ranking of corporate reputation.

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500-2021-026-AT&T

AT&amp;T CEO Randall Stephenson spent 13 years in command of the company, building a wireless and telecom giant and then acquiring DirecTV and Time Warner. But in June 2020 Stephenson retired, and his longtime lieutenant, John Stankey, took over. Stankey immediately faced plummeting revenue from the company’s movie production unit owing to cinemas being closed during the pandemic. Initially, that made it easier for him to shift new movie releases to AT&amp;T’s HBO Max streaming service, which added 7 million new U.S. subscribers in 2020 thanks to the arrival of blockbusters like Wonder Woman 1984 and hit shows like The Flight Attendant. Still, needing more money to fund AT&amp;T’s costly expansion into 5G wireless, Stankey sold 30% of DirecTV to private equity firm TPG, raising $8 billion. And in May 2021, the company announced its plans to spin off its WarnerMedia assets and merge them with Discovery—a stunning strategic about-face that represents an almost complete withdrawal from the “content” business.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-11-ATT

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-022-ATT

Revenue at the newly created communications and entertainment conglomerate increased 6%, but profits dropped 28% amid merger costs, pension charges, and changes in the value of some assets, among other items. CEO Randall Stephenson, in what would turn out to be his last year at the helm, focused on breaking down barriers in the company's WarnerMedia unit and creating a streaming video strategy to attract cord cutters. Now it will be up to new CEO John Stankey, who took over July 1, to keep all the pieces working in harmony—from an expensive new 5G wireless network to newly launched streaming service HBO Max.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-009-ATT

Revenue at the newly created communications and entertainment conglomerate increased 6%, but profits dropped 28% amid merger costs, pension charges, and changes in the value of some assets, among other items. CEO Randall Stephenson, in what would turn out to be his last year at the helm, focused on breaking down barriers in the company's WarnerMedia unit and creating a streaming video strategy to attract cord cutters. Now it will be up to new CEO John Stankey, who takes over on July 1, to keep all the pieces working in harmony—from an expensive new 5G wireless network to the rollout of new streaming service HBO Max.

Here are the World's Most Admired Companies for 2019 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 65th running of the list.

Here are the World's Most Admired Companies for 2018 as ranked in their industries. See who made the list.

Our 2018 list of the 100 best companies as ranked by their employees. See which companies made the list.

Fortune 100 Best Companies to Work For

This year's Fortune 500 marks the 64th running of the list.

Here are the World's Most Admired Companies for 2017 as ranked in their industries. See who made the list.

Our 2017 list of the 100 best companies as ranked by their employees. See which companies made the list.

This year's Fortune 500 marks the 63rd running of the list.

Here are the World's Most Admired Companies for 2016 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.6 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 62nd running of the list.

Business insiders have spoken: Asked which companies they most admire, more than 4,100 executives, directors, and analysts chose these top 50 All-Stars.

The world's 500 largest companies generated $31.2 trillion in revenues and $1.7 trillion in profits in 2014. Together, this year's Fortune Global 500 employ 65 million people worldwide and are represented by 36 countries.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

Perks

100% health coverage

Unlimited sick days

Telecommuting

Job sharing

Subsidized childcare

Compressed work weeks

Fully-paid sabbaticals

On-site fitness/subsidized gym

On-site medical care facility

Health insurance for part-timers

Sick days for part-timers

College tuition reimbursement

Student loan debt repayment

Medical facility at all locations

Hiring/staffing (past 12 Months)

Full-time and part-time job growth

# of job applicants

Jobs filled internally

# New graduates hired

Sector

Industry

Current All-Star Rank

Previous All-Star Rank

Industry Rank

Previous Industry Rank

Overall Score

Innovation

People Management

Use of Corporate Assets

Social Responsibility

Quality of Management

Financial Soundness

Long-Term Investment Value

Quality of Products/Services

Global Competitiveness

Culture rank

Process rank

Product rank

Years on list

Previous rank

Key Financials (last Fiscal Year)

Revenues ($M)

Profits ($M)

Assets ($M)

Total Stockholder Equity ($M)

Profit Ratios

Profit as % of Revenues

Profits as % of Assets

Profits as % of Stockholder Equity

Earnings Per Share (last Fiscal Year)

Earnings Per Share ($)

EPS % Change (from prior fiscal year)

EPS % Change (5 year annual rate)

EPS % Change (10 year annual rate)

Total Return

Total Return to Investors (last year)

Total Return to Investors (5 year, annualized)

Total Return to Investors (10 year, annualized)

AT&amp;T is among the world’s largest telecommunications companies, offering wireless communications, broadband internet, and entertainment services. The company held a decades-long telephone monopoly in the U.S. before a 1982 antitrust settlement broke it into parts. In 2023, AT&amp;T was the world’s largest telecommunications company by revenue. In 2022, AT&amp;T finished merging its spinoff WarnerMedia with Discovery, a reorganization that resulted in the creation of Warner Bros. Discovery.

Q2 2025

Q1 2025

Q4 2024

AT&T (T): Company Profile, Stock Price, News, Rankings

legacy

AT&T

at&t

Good morning, and welcome to AT and T's 4th Quarter 2024 Earnings Call. At this time, all participants are in listen only mode. Following the presentation, the call will be open for questions. As a reminder, this conference is being recorded. I would now like to turn the conference call over to your host, Brett Feldman, Senior Vice President, Finance and Investor Relations.

Thank you, and good morning. Welcome to our Q4 call. I'm Brett Feldman, Head of Investor Relations for AT and T. Joining me on the call today are John Stankey, our CEO and Pascal Desrocher, our CFO. Before we begin, I need to call your attention to our Safe Harbor statement.

It says that some of our comments today may be forward looking. As such, they are subject to risks and uncertainties described in AT and T's SEC filings. Results may differ materially. Additional information as well as our earnings materials are available on the Investor Relations website. With that, I'll turn the call over to John Stankey.

Thanks, Brett. I appreciate you joining us.

hope you'll find there aren't going to be any surprises on today's call. We finished 2024 strong, like we said we would at our Analyst and Investor Day in December. We achieved full year results that are in line or better than all the consolidated financial guidance we provided at the beginning of the year. Before I cover our accomplishments, I'd like to extend my heartfelt sympathies to everyone in Southern California. Our thoughts and prayers with all those people whose lives, homes and families have been deeply impacted by the most destructive wildfires in modern U.

S. History. In these moments, the importance of connection becomes increasingly apparent, and I'd like to thank our teams for their commitment to keeping customers, communities and first responders connected in the face of this historic devastation. Now turning to our 2024 performance, our team delivered another solid year as they again drove durable 5 gs and fiber subscriber growth. In mobility, our consistent go to market strategy continues to resonate as more customers are choosing and staying with AT and T.

Last year, we had about 1,700,000 postpaid phone net additions with service revenue growth of 3.5%. We also expect to lead the industry in postpaid phone churn for the 14th time in the last 16 quarters and to lead the industry on an annual basis for the 4th straight year. This is an impressive winning run-in wireless. And as you've heard me say before, where we have fiber, we won as well. We've now added 1,000,000 or more AT and T fiber subscribers for a remarkable 7 straight years.

It's clear that fiber is the best broadband alternative technology available and this was validated by Ookla just last week when they named AT and T Fiber America's fastest internet with the most reliable speeds. Following another strong quarter for both AT and T Fiber and AT and T Internet Air, we've now achieved 6 consecutive quarters of positive broadband net adds. Once again, we demonstrated our ability to grow in a healthy and sustainable manner by adding valuable subscribers while simultaneously simplifying experiences and processes for our customers and employees. You see the results of these efforts and the margin expansion and free cash flow growth we delivered in 2024 as we outlined at our Analyst and Investors Day, we expect these trends will continue. Our investment in 5 gs and fiber is fueling the sustained growth.

This is why we're so focused on building a durable franchise for the long term. Our deliberate and balanced approach to capital allocation is putting us on a strong foundation to deliver attractive returns for years to come. With about $22,000,000,000 in capital investment last year, we again invested at the top of the industry as we continue to focus on building the largest, highest capacity, lowest marginal cost converged broadband network in the country. Investing to build a truly differentiated network will provide long term benefits to AT and T and the many customers, businesses and communities we serve. And if the new Trump administration is successful in extending expiring tax incentives this year, we feel there's ample opportunity for even more investment in U.

S. Communications infrastructure. Ultimately, we did what we said we would last year. And as a result, we exited 2024 in a stronger competitive position. We still have a few things to accomplish.

In 2025, we'll focus on executing against the priorities we laid out at our Analyst and Investor Day. This starts with our customers. We plan to grow 5 gs and fiber subscribers by offering an elevated customer experience with a compelling opportunity to enjoy both of these connectivity services from 1 provider. We remain focused on growing our business the right way, which we expect to achieve by once again gaining profitable customers and operating our business more efficiently. In December, we established a new $3,000,000,000 plus run rate cost savings target that runs through the end of 2027.

In 2025, we'll make progress on this goal by further integrating AI throughout our operations. We also expect to realize cost savings as we evolve our technology stacks and work to exit our legacy copper network operations across the large majority of our wireline footprint by the end of 2029.

Last month, we received FCC approval to begin the process to stop selling, transition and discontinue legacy voice services in a small number of wire centers, utilizing our AT and

T Phone Advanced service as a replacement. This was an important first step to establish a template that supports a deliberate and planned transition to a more capable and modern communications infrastructure. Within the next few weeks, we will make detailed filings with the FCC to stop selling legacy products in about 1300 wire centers, which is about a quarter of the wire centers across our footprint. We look forward to working with the CAR FCC to accelerate and advance policies and actions that stimulate investment and modernization of the U. S.

Communications infrastructure. On the investment front, we anticipate capital investment in the $22,000,000,000 range again this year as we invest in modernizing our wireless network, expanding where we're able to offer fiber. We also expect to achieve our target of net debt to adjusted EBITDA in the 2.5x range in the first half of this year. This keeps us on pace to commence common stock repurchases using our initial board approved tranche of approximately $10,000,000,000 during the second half of twenty twenty five. This is part of a broader $40,000,000,000 plus shareholder return plan that we expect to deliver over the next 3 years, which includes more than $20,000,000,000 in total dividend payments and an overall capacity for about $20,000,000,000 in share repurchases.

Under this plan, we also have an additional $10,000,000,000 in incremental financial flexibility to pursue strategic opportunities, improve our balance sheet or deliver further capital returns to shareholders. Now, before I wrap, I'd like to finish where I started, with the customer and briefly share how the AT and T guarantee builds on the vision we shared with you in December. Over the past several years, we've pivoted the AT and T brand by using our deep knowledge and insights to orient our services around putting our customers and what they want first. This has led to improvements in how customers feel about AT and T as evidenced by our broadband customer satisfaction leadership, our improving wireless net promoter scores and our overall continued low churn. After over a year of research and preparation, we are taking the important step to establish a platform to differentiate our brand in the marketplace with the AT and T guarantee.

T is the 1st and only telecommunications company to offer a guarantee for both its wireless and fiber network. AT and T Guaranty is a bold promise to our customers that we'll deliver connectivity that they can depend on, deals they want and the prompt friendly service they deserve or will make things right if we fall short. With the AT and T guarantee, customers have peace of mind that the company stands behind our products and services in a way that no one else in our industry is doing. Our guarantee is a truly converged full company effort. It spans across both wireless and fiber, covering both consumers and small businesses.

And with enterprise customers, we remain committed to providing high quality service in our contractual agreements as we always have. We were able to offer this unique promise to our customers because we own and operate scaled 5 gs and fiber networks where we control the network architecture, operations and end to end customer experience. This allows us to provide a proactive and compelling customer guarantee that's tough to beat and an internal operating posture that focuses all of AT and T's employees on getting it right for our customers. We feel confident that our customers will repay us with loyalty and we can attract new customers as well. So in summary, we have a clear strategy in place to advance the plan we shared at our Analyst and Investor Day.

We have the right people, capabilities and differentiated assets to achieve our goals in 2025 and beyond. With that, I'll turn it over to Pascal.

Thank you, John, and good morning, everyone. Let's start by reviewing our Q4 financial summary on Slide 8. Overall, we're really pleased with how our team closed out the year as we continue to grow subscribers profitably. 4th quarter revenues were up nearly 1%, largely driven by wireless service and equipment revenues as well as broadband revenues.

This was partly offset by a decline in business wireline. Adjusted EBITDA for the quarter was up 2.2% as growth primarily in mobility and consumer wireline were partially offset by declines in business wireline. Adjusted EPS was $0.54 in the quarter, in line with the prior year despite $0.04 of below the line net headwinds that we outlined at the beginning of the year. 4th quarter free cash flow was $4,800,000,000 which included about $1,100,000,000 in pretax DirecTV distributions. 4th quarter cash from operating activities came in at 11,900,000,000 dollars up about $500,000,000 year over year.

Beginning with the Q4, all cash distributions from DIRECTV are now reported within cash from operating activities. However, as a reminder, starting with our Q1 of 2025 results, we will exclude all cash received from DIRECTV from reported free cash flow. 4th quarter capital expenditures were $6,800,000,000 with capital investment of $7,100,000,000 We delivered a strong financial performance during the quarter, while absorbing strong impacts that were slightly higher than the estimate we provided on our Q3 call. Now let's take a look at the results we delivered against our 2024 financial guidance on Slide 9. For the full year, we achieved all our consolidated financial guidance.

We expected mobility service revenue growth in the 3% range and achieved growth in the 3.5% range primarily by growing profitable customer relationships. In Consumer Wireline, we met our target of 7% plus growth in broadband revenues, driven by fiber revenue growth of nearly 18%. Consolidated grew 3.1% for the full year compared to our expectation of growth in the 3% range. Adjusted EPS for the full year came in at $2.26 which is slightly better than the high end of the $2.20 to $2.25 range we provided at our Analyst and Investor Day. As we shared previously, in 2025, we plan to report adjusted EPS excluding DIRECTV.

When excluding approximately $0.31 related to equity in net income of DIRECTV, full year adjusted EPS in 2024 was 1.95 dollars Capital investment for the full year was approximately $22,000,000,000 consistent with our guidance at the high end of the $21,000,000,000 to $22,000,000,000 range. On free cash flow, we delivered slightly better than the midpoint of our guidance in the $17,000,000,000 to $18,000,000,000 range with full year free cash flow coming in at $17,600,000,000 In 2025, we also plan to report free cash flow excluding DIRECTV. For comparison, 2024 free cash flow was $15,300,000,000 excluding approximately 2,300,000,000 of after tax cash distributions from DIRECTV. Now let's look at our Mobility operating results on Slide 10. Our Mobility business continues to deliver strong results, growing both revenues and EBITDA for the 7th consecutive year.

We posted 482,000 postpaid phone net adds in the quarter as we continue to successfully add high value subscribers. Mobility revenues were up 3.3% for the quarter, with service revenues also up 3.3%. 4th quarter mobility EBITDA was up about $500,000,000 or by 6.1%, driven by growth in service revenues. Similar to recent quarters, about 100% of the year over year growth in our mobility service revenues flow through to EBITDA. This is the result of sustained low churn and our focus on driving operating efficiencies.

For the full year, mobility EBITDA grew 6.3%. This is consistent with our guidance for growth in the high end of the middle single digit range. Mobility postpaid phone ARPU was $56.72 in the 4th quarter, up nearly 1% year over year. ARPU growth continues to be largely driven by our targeted pricing actions and from plan mix. Postpaid phone churn for the quarter was 0.85%, up 1 basis point versus the prior year, while the upgrade rate declined 10 basis points to 4.6%.

Customers reaching the end of their device promotions returned to a more normalized level on a seasonal basis in the 4th quarter, and we expect this to continue during 2025. In prepaid, our phone churn was less than 3% with Cricket phone churn substantially lower. Similar to last year, our 2025 guidance anticipates a healthy wireless market with further normalization of net adds and overall activity levels. We're confident that our mobility business will deliver solid performance again in 2025, and we continue to expect full year growth in service revenues in the higher end of the 2% to 3% range and EBITDA in the higher end of the 3% to 4% range. Now let's move to Consumer Wireline results, which are on Slide 11.

Our Consumer Wireline business again delivered strong performance with 307,000 AT and T Fiber Net Adds, our highest ever during the Q4. This solid subscriber growth reflects durable demand for AT and T Fiber as a result of its superior experience as well as the increased pace at which we've been expanding customer locations served by our fiber network. We also believe we benefited from some pent up demand following a 1 month work stoppage in the Southeast during the Q3. AT and T Internet Air continues to perform well in the marketplace. We added 158,000 AT and T Internet Air consumer subscribers in the quarter and totaled more than 500,000 net adds for the full year.

Our combined success with AT and T Fiber and AT and T Internet Air continues to more than offset declines in our legacy copper subscriber base, which helped us achieve 123,000 total broadband net adds in the quarter. Fiber ARPU was $71.71 up $1.35 sequentially and 4.7% year over year. The improved trend in fiber ARPU growth in 4Q was driven by pricing actions and favorable plan mix. 4th quarter broadband revenues grew 7.8%, driven by fiber revenue growth of 17.8%. In 2025, we expect fiber revenue growth in the mid teens, which is consistent with the multiyear guidance we provided at our Analyst and Investor Day.

Consumer Wireline EBITDA grew 9.8% for the quarter and 10% for the full year, which exceeded our guidance for full year growth in the mid- to high single digit range. This was driven by growth in high margin fiber revenues and by our ongoing transition away from providing service over our legacy copper network. We expect these dynamics to continue in 2025 and to drive consumer wireline EBITDA growth in the high single to low double digit range. And while our fiber investment is delivering strong returns on a standalone basis, it's also benefiting our mobility business as we add more converged customers. Our AT and T Fiber penetration is 40% today with 4 out of every 10 AT and T Fiber households also choosing AT and T as their wireless provider.

Both these metrics improved by about 100 basis points versus the prior year, reflecting strong demand for our fiber and 5 gs services together. As we discussed at our Analyst and Investor Day, over the long term, we expect to grow our fiber penetration and our penetration of converged services within our fiber footprint. Now let's turn to Business Wireline on Slide 12. In the quarter, Business Wireline revenues declined 10% and EBITDA was down 22%, primarily due to continued industry wide secular declines in legacy services. For the full year, Business Wireline EBITDA declined 18%.

This is in line with the latest guidance we provided for declines in the high teens range. For full year 2025, we expect Business Wireline EBITDA to decline in the mid teens range. In the Q4, our Business Solutions wireless service revenues grew 3.5%, which is faster than our overall growth in mobility service revenues. FirstNet continues to be a consistent growth category for us with wireless connections up about 300,000 sequentially and we ended the year with more than 6,700,000 total connections. Now let's move to Slide 13 for an update on our capital allocation strategy.

In 2024, we were able to strengthen our balance sheet while maintaining industry leading capital investment. For the full year, we reduced net debt by $8,800,000,000 and during the Q4, we reduced net debt by $5,700,000,000 sequentially. 4th quarter net debt included a $2,400,000,000 non cash FX benefit related to our foreign denominated debt. However, there was no net balance sheet impact as there was an offsetting FX loss related to associated hedges. Another item that contributed to the reduction of net debt in the Q4 was the completion of a distribution of about $1,500,000,000 in cash from previously restricted assets.

This is reflected in cash from investing and therefore did not impact our reported free cash flow. As a result of our adjusted EBITDA growth and strong cash generation, we ended 2024 with net debt to adjusted EBITDA below 2.7x. Additionally, we lowered vendor and direct supplier financing, which more than offset securitization facilities for a net reduction of $400,000,000 year over year. Over the past 2 years, we've reduced our vendor financing balance by about $4,700,000,000 dollars Our efforts to reduce vendor and direct supplier financing have helped us to lower our interest expense and to improve the quality and ratability of our cash flows. Given these efforts, we feel good about our combined vendor and direct supplier financing levels and do not expect to materially reduce them on a year over year basis in 2025.

We continue to expect to close the sale of our 70% state in DIRECTV to TPG in the middle of this year. Since signing this agreement, we have received $1,700,000,000 in pretax cash distributions from DIRECTV and expect to receive an additional $5,900,000,000 in after tax cash payments related to this transaction through 2029. This includes $5,400,000,000 that we continue to expect this year. The strength of our operating trends, growth in our free cash flow and improvement in our balance sheet have positioned us to increase our capital returns to shareholders. As discussed at our Analyst and Investor Day, we expect to maintain our dividend per share and to begin share buybacks in the second half of twenty twenty five once we're in this 2.5 times range for net debt to adjusted EBITDA.

Our operating momentum and capital allocation framework positions AT and T to drive shareholder value through a combination of capital appreciation and capital returns in 2025 and beyond. Now let's cover our 2025 financial guidance. Our outlook for the year is unchanged from the guidance we shared at our Analyst and Investor Day, but I'd like to highlight a few key drivers of our guidance for adjusted EPS and free cash flow in order to help you with your modeling. As mentioned earlier, beginning in the Q1, we plan to report adjusted EPS and free cash flow excluding DIRECTV due to the pending 2025 disposition of our equity investment. On this basis, our guidance anticipates growth in both of these metrics this year, driven primarily by our outlook for growth in consolidated adjusted EBITDA of 3% or better.

Our adjusted EPS guidance for 2025 of $1.97 to $2.07 also assumes depreciation and amortization expense in 2025 to be slightly higher than 2024 from continued investment in our 5 gs and fiber networks, lower interest expense from lower debt balances and an effective tax rate around 23%. Our planned share repurchases starting later this year are not expected to materially benefit our adjusted EPS in 2025. Looking a little further ahead, we continue to expect adjusted EPS to grow at a double digit CAGR from 2027 as outlined at our Analyst and Investor Day. This is driven by our outlook for annual adjusted EBITDA growth of 3% or better as well as accumulating benefits of reducing our share count through planned share repurchases. It also assumes lower depreciation expense beyond 2025 as we complete our wireless network modernization and take legacy assets out of service.

Our guidance for $16,000,000,000 plus of free cash flow this year assumes lower cash interest from lower debt balances, the absence of network termination fee payments in 2025 and lower working capital impacts in 2025 compared to 2024. Collectively, these items as well as our anticipated adjusted EBITDA growth are expected to more than offset an increase in cash taxes. Excluding DIRECTV, we expect 2025 cash taxes to be $3,300,000,000 which is up about $1,500,000,000 from 2024 on a comparable basis. This expectation is based on current tax law, including the continued phase out of bonus depreciation. We also expect that our free cash flow will continue to have a more ratable profile over the course of the year.

As a reminder, we typically see seasonally lower free cash flow in 1Q, primarily driven by the timing of device payments and annual incentive compensation payout. Also keep in mind that DIRECTV contributed $500,000,000 to last year's Q1 free cash flow. We're excited about our outlook for the year and beyond. We're reiterating all the long term financial and operational guidance we shared at our Analyst and Investor Day in December. Brett, that's our presentation.

Thank you, Pascal. Operator, we're ready to take the first question.

Thank you. We will now begin the question and answer Today's first question comes from John Hoplick with UBS. Please go ahead.

First of all, on the regulatory filing about the legacy products, are there any direct cost savings that would come with this that you could potentially see in 'twenty five if that's successful? And I think this is probably the first step in terms of the heading towards the decommissioning of that copper infrastructure. How would you expect the sort of steps to proceed if you're successful

And then number 2 on tax reform. 1, just what's your view on the chances of getting that through? And you mentioned that you could go a little faster with some of the CapEx. Would that be a 25 issue or 26? And what are some of the areas you think that you could do more spending and accelerate the plan?

Hi, John. Good morning. So the legacy filings, first of all, what you should understand is as we laid out our new cost savings objectives for you over the next 3 years as we discussed in the Analyst Day, as we gave you that detail, you can see that we are expecting that we're going to make progress in taking those costs out of the business and that's a key foundational element to those estimates. So what you would expect here in this filing is we've kind of factored all those into the guidance we've given you and the timing of those things.

I'm not going to break out on a per central office basis exactly how long it takes us to recognize that. But these are processes that take some time is what you should think about. We have to go through notice cycles with customers. We then have to ultimately transition them. We grandfather them.

So these are not things like you file and 90 days later, you're starting to see a dramatic shift or a step function shift in costs. These are what gets us to our objectives by 'twenty nine and ultimately reshaping the footprint and the cost structure of the business. How those steps proceed? As I said in my comments, the first step is we now have a framework. We're now going to put the 1st scale test of that framework in with about 1300 wire centers.

We expect that when we do that, the commission is going to say, what do I do with 1300 wire centers? And we're going to work collaboratively with them to build a process to move through that as quickly and expeditiously as possible. My expectations are from the dialogue that's occurring right now, the new administration is interested in finding approaches to scale these more rapidly and have an appropriate way to clear them through faster because they believe if the right policies are in place, it will in fact stimulate investment in the right kind of going forward technologies and we intend to embrace that work with them and figure out how we take 1300 successfully through the commission and then move through another tranche as we move through that. So that's all part of the process and it's kind of how we expected this back 2 years ago when we started moving down this path and putting this framework in place and building the technologies to enable it. This is kind of what we expected would be the case.

And I feel good, as I mentioned, I think at the Analyst Day, I think with the administration change, we kind of moved to a little bit of a tailwind in terms of the receptivity of the approach as we go through that. On the tax reform side, look, I'm hopeful and I'm optimistic that a Washington that has one party in control can figure out how to set priorities for themselves. My indications would be that from an economic growth perspective that the Republicans believe this is a key driver of what will get the economy moving in the right direction. I would certainly say from my little part of the economy, those policies would drive accelerated and stimulated investment as they did the first time we were in place. I've used this comparison.

We were peaking at about $24,000,000,000 of investment a couple of years ago. It's not an accident. Our tax bill is up about the same amount that we're down in capital investment right now. I don't expect we'd ever get back to $24,000,000,000 at this juncture given how far along we are in our reinvestment strategies. But do I think that the first place I would go if I had a little bit of latitude might be to accelerate some of the fiber build?

The answer to that is, yeah, I probably would look at tweaking that and some of that might go into investment and completing the fiber plan earlier, some of it may be returned to shareholders. We can't turn on a dime to answer your question. When you think about what occurs with the fiber build, as I shared with you at the analyst conference, if you want to think about increments of 1,000,000 a year, so if we're building 3,000,000 right now and we wanted to move to 4,000,000, that's probably a 12 month best case, 18 month worst case scenario to ramp to that level. And when you start thinking about how you gracefully do these things, increments of $1,000,000 are kind of the graceful way to go about doing it, where you're not whip sign vendor communities, supply chains, doing things that are inappropriate. So I think about that within the course of a year, can you scale yourself up to get to another million?

That's a decision that we'd have to make after we saw some tangibility that the tax cuts are in fact going to go into place.

And our next question today comes from David Barton of Bank of America.

I guess my first one for you, John, just returning to a topic that we discussed at the Analyst Day, which is this notion of home games and away games and the benefits that fiber brings to the mobile business. I'm noticing in the Q4 that the gains in mobile net adds among fiber customers was equal to the total net adds for the quarter and about probably 22%, 23% of gross adds. Is that something is there some information value in examining how those pieces fit together? And then the second question, if I could, Pascal, this Reign real estate deal and the $850,000,000 it's contributing, I guess the question is going to be, was knowing that that's coming part of the $16,000,000,000 or is it part of the plus? And how do we think about maybe as we decommission the copper plant, especially future real estate deals contributing to this cash flow picture?

Hi, Dave. I don't know that I would over rotate on the information value, if I understand your questions your question correctly. I think typically when you look at what our strategies are for how we actually penetrate within the base, there isn't necessarily perfectly a timing to what I would call the net add dynamics that occur in broadband whether or not we're successful at penetrating. There is some activity we get on installation, which is helpful to us. But when you start thinking about what we want to do to drive up that penetration number, the base of unaddressed individuals is much larger than the base of new customers going in.

And so we have to do well in that unaddressed base in order to get net adds in it. There's different strategies associated with it. Pascal, do you want to address the Reign dynamic and the fact that it doesn't run through cash flow?

Yes. So Dave, the RAIN deal is we're accounting for it as a financing transaction. It's not going to run through cash from operations or free cash flow. It will be running through our financing section of the balance sheet. You zoom out, Dave, when I think about what are the drivers of free cash flow in 2025, it starts with our expected EBITDA growth.

We also, as we highlighted at Investor Day, in 2024, there was a, call it, about $500,000,000 of headwind associated with paying out a termination fee associated with our O RAN modernization effort. Additionally, the other tailwind you should expect is you're going to see some benefit from interest and working capital. We have if you saw the way we ended the year, our interest expense was down. And I would expect that to continue into 2025. And I wouldn't expect working capital to be a major factor one way or the other.

And so really those are the dynamics driving it.

It. And our next question today comes from Michael Rollins with Citi.

You used the same or similar language around the healthy wireless market and a further normalization of net add and activity levels. Curious if you could just put some additional context around that, how that may look similar or different than last year in terms of characteristics and how AT and T is looking at the mix between volume growth and R2 opportunity within the 2025 guidance. And just one other quick item, in the trending schedule, you added a much larger number of resell subs. I think it was up 13.5% quarter on quarter. And just curious, what drove that performance?

And does reseller become a more significant component of mobility service revenue growth during 2025? Thanks.

Hi, Mike. Good to hear from you. So I would tell you it's the same or similar as to what we said last year. That's why the similar language, we expect further normalization. I don't think we're seeing a whole lot different.

As I've said before, how we think about the customers that we want to attack that are long term durable sustainable customers versus what gets counted in the bucket in aggregate, they don't all necessarily represent that number. But we've seen a bit of a moderation going on and we expect there's going to be a little bit of a moderation going on this coming year that we work through. As with previous years, we're going to do everything we can to do both. We're going to have some volume improvement as we gain customers and we're also going to manage the base like we effectively manage the base. I'm not going to break out for you what represents in each of those.

We never do talk about those things. I don't intend to do that going forward. But you can expect that we know how to manage a subscription business and we know how to balance the 2 out. There's going to be pockets of our base out there where we can move them through continuum of either getting more value through different plans or finding pockets where maybe we're priced differently to the market, what needs to be as well as growing subscribers. And we'll do both and we'll do it effectively.

What you're seeing on the resale side is, I think we've been really clear and we indicated that we were a provider to DISH and their migration and how they've been handling their customer accounts were beneficiary, I think, of some of their decisions as to what networks they're putting their customers on and how they're operating that. That was certainly not the only contributor, but a significant contributor to what's occurring in that. And then we've also had some success in some other MVNO reseller accounts that are now starting to generate some volume as well that are contributing to that.

Thanks, Mike. We're going to go to the next question, operator.

Absolutely. Our next question comes from Benjamin Swinburne with Morgan Stanley. Please go ahead.

Thanks. Good morning. Question on fiber and one on mobility. Pascott, I think you mentioned maybe some pent up demand benefited the Q4 coming off the labor strikes at the end of Q3. Any ability to size that for us?

And then I'm curious, you guys had really strong fiber ARPU growth in the Q4 and the year. We've seen some of your cable competitors get more aggressive with their own converged offers. It doesn't seem like that's having any impact. But just wondering if you could talk a little about your confidence in fiber ARPU growth heading into 2025? And then just on mobility, great churn results.

Any update on sort of how you're feeling about gross adds and whether that can maybe inflect positive in 2025 as Jen and team kind of put a lot of their initiatives into place? Thanks so much.

Hi, Ben. So look, the pent up demand dynamic, it's not substantial. I just think that there's there clearly was some there were some customers after we were out of the market for 30 days in the Southeast that decided they were going to wait and we were able to work through that effectively. And I think that's a certain amount of what you're expecting or what we saw in the Q4 of turning in that $307,000 number. I don't see anything in our overall trends that suggest anything different moving forward right now.

We've given you an indication. There's a variety of things that drive kind of what you should expect in volumes in fiber in a quarter, one of which is the size of the footprint and what we have to sell into. And then, of course, there's a seasonality dynamic that goes into that. So as we move into the Q1, seasonality adjustments tend to be a little bit slower than what we see otherwise. And we still have good footprint to sell into, but that pent up demand will disappear.

So you should expect that that's not going to carry into the Q1. Exactly what that number is, I don't know that I can precisely put a number on it, but I don't see anything in the market that suggests to me right now that there's any fundamental trend difference in how we're penetrating the market and what we're doing overall. And the ARPU growth, what I would tell you is, as I just indicated, we continue to manage the base effectively and look for opportunities to either move customers up and plan to buy higher speeds or work on pricing adjustments where it makes sense to do that. We did get a benefit of a price increase on some portions of our cohort that worked through the Q4 that I think you're seeing roll through that. But there's also a dynamic of a higher percentage of the base moving into fiber versus copper legacy products that usually comes with a step up in ARPU that we get improvements on.

And we're going to continue to actively manage that. But you should understand we're actively managing that underneath an umbrella. We're still lower than cable on an ARPU basis. And that's one of the reasons we do as well as we do. And why we don't feel that we need to necessarily discount a better product when we're putting 2 together is because we are selling currently in the market kind of underneath Cable's pricing umbrella at a more competitive price.

So that still continues to be the case as we move forward. What I would expect on where we are in the mobile side is, should our gross ad performance get a little bit better relative to what we want to do on the share side in certain segments? Yes. But do I expect that we're going to be looking at outsized numbers given the overall pool of growth is getting smaller? No.

Pascal, I don't know if there's anything you want to add to what I shared there?

Absolutely. Our next question comes from Peter Cipino at Wolfe Research. Please go ahead.

AT&T (T) Q4 2024 Earnings Call Transcript

Company Participants