stockrowWhat it does
AT&T is a telecommunications and technology holding company headquartered in Dallas. John T. Stankey is Chairman, Chief Executive Officer and President. Its operating subsidiaries sell connectivity: wireless phone and data service, home broadband, and network services for businesses.
Its main U.S. Communications segment combines three businesses. Mobility supplies nationwide wireless service and devices to consumers, wholesale and resale subscribers. Business Wireline sells fiber-based ethernet, dedicated internet, fixed wireless, IP voice, managed services and related equipment to companies, government bodies, wholesale customers and multinational customers. Consumer Wireline supplies residential fiber broadband, AT&T Internet Air fixed wireless internet, and legacy telephone service.
The network is built around fiber and spectrum used for 5G wireless service. Fiber carries fixed broadband traffic and supports wireless network capacity; customers can also take both home internet and mobile service. AT&T Internet Air delivers home internet over the 5G network where fiber is unavailable. In Mexico, the Latin America segment provides consumer and business wireless voice, data and devices under the AT&T and Unefon brands.
At December 31, 2025, AT&T served 120 million U.S. Mobility subscribers, including 91 million postpaid subscribers, and had 10.4 million fiber consumer broadband customers. Management said on the Q3 2026 call that AT&T added over 1 million advanced-connectivity subscribers across fiber, fixed wireless and postpaid phone during the quarter.
How it makes money
AT&T earns service revenue when customers pay for wireless plans, broadband connections, business connectivity and legacy voice or data services. It also earns equipment revenue from handsets, wireless devices, accessories and customer-premises equipment. Wireless customers can buy devices outright or on installments, while postpaid subscribers may receive promotional equipment offers when starting, renewing or upgrading service. Prepaid wireless is typically paid monthly in advance.
The Communications segment is the primary revenue source, with Mobility, Business Wireline and Consumer Wireline sharing network assets and selling integrated offerings. Wireless service revenue was $70.1 billion in FY2025, or 46.7% of revenue. Equipment revenue was $24.5 billion. Business Service revenue was $16.0 billion, while Legacy Voice and Data revenue was $10.4 billion. The Latin America segment earns service and equipment revenue in Mexico.
Service revenue is the continuing part of the model, whereas device and other equipment revenue depends more on sales volumes and upgrades. Customer pricing, promotional activity, subscriber additions, churn, device financing and the mix of fiber, fixed wireless and legacy services affect revenue. AT&T states that future wireless growth depends on service plans, devices and bundled offerings that add converged customer relationships.
FY2025 segment revenue was $120.9 billion for Communications, $4.4 billion for Latin America and $373.0 million for Corporate and Other; it was reported on 23 October 2026 that Q3 revenue was $32.3 billion and wireless service revenue was $17.76 billion. Management said on the Q3 2026 call that wireless service revenue grew 5% year over year.
| Product or service | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| Wireless Service | $70.1 billion | 46.7% | 3.02% |
| Equipment | $24.5 billion | 16.3% | 10.3% |
| Other Capitalized Property Plant and Equipment | $24.5 billion | 16.3% | 10.3% |
| Business Service | $16.0 billion | 10.6% | 11.3% |
| Legacy Voice and Data | $10.4 billion | 6.90% | −17.8% |
| IP Broadband | $3.5 billion | 2.36% | −7.30% |
| Other Service | $1.2 billion | 0.78% | −9.46% |
Customers and how it sells
AT&T serves U.S. consumers, residential households, wholesale and resale wireless subscribers, businesses, government customers and multinational corporations. Mobility had 120 million subscribers at December 31, 2025: 91 million postpaid, 18 million prepaid and 11 million reseller subscribers. Consumer Wireline provided broadband and internet services to approximately 14.7 million customers, including 10.4 million fiber connections and 1.5 million Internet Air connections.
Business Wireline sells to multinational corporations, small and mid-sized businesses, government and wholesale customers. AT&T had no customer accounting for 10% or more of consolidated revenue in 2025. It sells devices and services online, through company-owned stores, agents and third-party retail stores.
The United States generated $120.2 billion, or 95.7%, of FY2025 revenue. Mexico generated $4.4 billion, or 3.52%. The Mexico business had approximately 24.7 million wireless subscribers at December 31, 2025, although management said on the Q3 2026 call that AT&T signed an agreement to sell that wireless business. Management also said that nearly 43% of advanced home internet customers had an AT&T postpaid wireless account at the end of Q3 2026.
| Region | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| United States | $120.2 billion | 95.7% | 2.86% |
| Mexico | $4.4 billion | 3.52% | 3.31% |
| Asia/Pacific Rim | $395.0 million | 0.31% | −14.5% |
| Europe | $382.0 million | 0.30% | −13.4% |
| Other | $114.0 million | 0.09% | −1.72% |
| Latin America | $110.0 million | 0.09% | −26.2% |
Suppliers and costs
AT&T buys network equipment, customer-premises equipment, handsets, mobile hotspots, wireless data cards and other connected devices from suppliers. It depends on certain key single-source suppliers where few alternatives are available. Delays, export-license issues, component shortages, inflation, natural disasters or political disruption can interrupt supply or raise costs. Management said on the Q3 2026 call that AT&T reached a multi-year agreement with Corning to supply fiber for its network expansion.
Its cost base includes devices and equipment sold to customers, network construction, spectrum, labor, retail and distribution, advertising, selling, bad debt, customer support, depreciation and employee benefits. Network upgrades and fiber deployment increase capital spending and depreciation. Higher device sales raise equipment, selling and working-capital requirements because AT&T generally pays for devices before collecting from customers over their relationship.
Approximately 43% of employees were represented by unions at December 31, 2025. AT&T employed 133,030 people at that date.
- Revenue$125.6B
- Cost of revenue−$50.8B
- Selling, general and administrative−$28.9B
- Other operating costs−$21.7B
- Operating income$24.2B
Competitive position
AT&T competes in U.S. wireless on service and device offerings, price, network quality, coverage and customer service. It also competes against regional providers, resellers, cable companies and providers of voice, messaging and other applications over data networks. In broadband, it competes with large cable companies, wireless broadband providers, satellite providers and internet-based providers. Legacy voice and data face competition from wireless, cable and VoIP providers, including providers with different technologies and lower-cost business models.
In Mexico, AT&T is one of three facilities-based providers, and América Móvil has the most significant market share. T-Mobile and Verizon were identified in reporting on a potential SpaceX wireless network. It was reported on 23 October 2026 that SpaceX was negotiating access to around 80,000 cell sites, potentially to build a fourth nationwide U.S. wireless network. AT&T also works with AST SpaceMobile on direct-to-device satellite connectivity, while satellite technology can serve areas where traditional terrestrial service is limited.
Our reading: AT&T’s network assets form a meaningful barrier because its U.S. wireless network covers more than 322 million people with 5G, its fiber footprint supports fixed and mobile services, and nationwide service requires spectrum, cell sites and extensive indoor infrastructure. [item1] [call_qa]
Our reading: This barrier does not remove competition, since pricing, promotions, cable, fixed wireless, satellite and internet-based alternatives can all pressure customer retention and margins. [item1] [item1a]
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| América Móvil | Mexico facilities-based wireless services | High |
| T-Mobile | U.S. nationwide wireless services | High |
| Verizon | U.S. nationwide wireless services | High |
| SpaceX | Potential U.S. nationwide wireless network | Medium |
Growth opportunities
AT&T expects growth from wireless and IP-based fiber broadband as demand rises for faster connectivity across mobile and fixed devices. Its expansion strategy combines 5G, fiber, Internet Air, business connectivity and accounts that take both wireless and home internet. At December 31, 2025, it had 16.0 million broadband connections, compared with 15.3 million a year earlier; it added 1.1 million fiber customers and 875,000 Internet Air connections during 2025.
Management said on the Q3 2026 call that advanced home internet service revenue grew more than 23% year over year and that AT&T had 696,000 advanced home internet net additions, including 416,000 fiber and 280,000 Internet Air additions. It also said business advanced-connectivity service revenue grew 2.5% year over year, with fiber and advanced-connectivity service revenue growing nearly 9%.
The company expects to reach 60 million plus fiber locations by the end of the decade. Management said it has a multi-year Corning fiber-supply agreement and a joint venture with Global Infrastructure Partners and CPP Investments that includes Gigapower and fiber assets acquired from Lumen. It also said more than 90% of mapped U.S. data centers are within 10 miles of its fiber, with AWS and Microsoft using or working with AT&T for high-capacity connectivity needs.
Management expects to retire copper-based legacy services while moving customers to Phone Advanced, fiber and Internet Air. It said more than 100 wire centers had no legacy-service customers in Q3 2026.
- $134.0BFY2021
- $120.7BFY2022
- $122.4BFY2023
- $122.3BFY2024
- $125.6BFY2025
Structural risks
- Wireless and broadband demand requires continuing capital investment, spectrum access and timely deployment. Delays in equipment standards, supplier deliveries, software, permits, labor or construction can increase costs or delay service launches.
- Competition can pressure pricing, promotions, churn and margins. Wireless market saturation may slow industry customer growth, while cable, fixed wireless, satellite, VoIP and internet-based alternatives compete for customers.
- Legacy copper, voice and data services are in secular decline. AT&T must migrate customers and obtain regulatory approvals to retire parts of the older network; unfavorable conditions on approvals can preserve cost and competitive disadvantages.
- AT&T relies on suppliers for network equipment and devices, including certain single-source inputs. Inflation, tariffs, semiconductor and network-component pressures, export requirements and supply disruption can affect availability and cost.
- Regulation, litigation and cybersecurity can affect operations. FCC, state and foreign rules govern spectrum, wireline services, deployment and privacy, while cyberattacks on AT&T, suppliers or vendors could disrupt networks or expose data.
- Higher interest rates, pension and medical costs, device financing and debt can affect funding needs and cash flows. Management said on the Q3 2026 call that net debt adjusted EBITDA was 3.13 times following a $23 billion spectrum-license purchase from EchoStar.
Bottom line
Our reading
Our reading: AT&T is a network operator whose recurring service revenue comes principally from U.S. wireless and broadband, supported by device sales and business connectivity. Its investment case rests on extending fiber and 5G coverage, adding customers that take both services, and reducing the cost and complexity of copper networks. [item1] [call_prepared]
Our reading: The business remains capital-intensive and exposed to aggressive competition, regulation, supplier dependencies and elevated leverage following spectrum investment; legacy-service declines make execution of customer migration and fiber expansion consequential. [item1a] [call_prepared]