AT&T (NYSE:T) reported faster growth in service revenue, adjusted EBITDA and adjusted earnings per share in the second quarter of 2026, with executives pointing to gains in fiber, fixed wireless and postpaid phone subscribers as the main drivers of the quarter’s performance.
Chairman and CEO John Stankey said the company added more than 1 million “Advanced Connectivity” subscribers across fiber, fixed wireless and postpaid phones, with all three categories posting higher net additions than a year earlier. He said the quarter marked AT&T’s best-ever second quarter for fiber net additions and a record quarter for combined fiber and fixed wireless net additions.
Revenue and Earnings Growth Accelerate
CFO Pascal Desroches said consolidated revenue rose 2.3% year-over-year in the second quarter, driven by 2.7% growth in service revenue. Adjusted EBITDA increased 5.2%, and adjusted EBITDA margin rose 110 basis points to 39.1%.
Adjusted earnings per share were $0.65, up more than 20% from $0.54 in the prior-year period. Desroches attributed the increase primarily to adjusted EBITDA growth and lower depreciation expense.
The company reiterated its full-year outlook for consolidated service revenue growth in the low-single-digit range, adjusted EBITDA growth of 3% to 4%, and adjusted EPS of $2.25 to $2.35.
Free cash flow rose by roughly $300 million year-over-year to $4.7 billion, exceeding the company’s guidance range of $4 billion to $4.5 billion. AT&T maintained its expectation for more than $18 billion in full-year free cash flow and $23 billion to $24 billion in capital investment.
Fiber, Wireless and Convergence Remain Central
AT&T’s Advanced Connectivity segment, which Desroches said contributes more than 90% of service revenue and nearly all adjusted EBITDA, continued to lead growth. Segment service revenue increased 5.1% year-over-year, while EBITDA rose 8%.
Wireless service revenue grew 3.3%, supported by customer growth, including 432,000 postpaid phone net additions, and pricing actions that took effect during the quarter. Desroches said AT&T added 147,000 consumer postpaid wireless accounts, its best result in more than three years.
Advanced home internet service revenue increased more than 27% year-over-year, driven by fiber net additions, accelerated fiber deployment, converged offers and the acquisition of fiber assets from Lumen in the first quarter. Fiber ARPU declined 1.3% from a year earlier, which Desroches said primarily reflected the full-quarter impact of the Lumen transaction, as those subscribers have lower ARPUs. Excluding customers in the acquired Lumen footprint, fiber ARPU was approximately flat.
Stankey said 42.5% of AT&T’s advanced home internet customers also had a postpaid wireless account at the end of the quarter. Excluding customers in the acquired Lumen footprint, the convergence rate was 45%.
“When customers consolidate their internet access with us, we see lower churn, outstanding brand affinity, higher lifetime values,” Stankey said.
During the question-and-answer session, Stankey said AT&T is focused on growing average account revenue and service revenue, rather than maximizing ARPU for individual products. He said the company is willing to use discounts strategically when they help create converged customer relationships that typically have lower churn and higher lifetime value.
Lumen Integration and Fiber Expansion Progress
Stankey said 2026 will be AT&T’s largest year ever for fiber expansion, with plans to reach 8 million new locations, including more than 4 million locations acquired from Lumen.
He said AT&T has spent the past six months standing up operations in the acquired Lumen footprint to support growth, network deployment and the branded rollout of AT&T Fiber. Stankey said June converged gross additions in those territories were up 45% compared with February, a figure he later clarified referred to AT&T’s ability to pair broadband sales with wireless service, not overall broadband sales volume.
Stankey said AT&T is converting infrastructure, branding, support systems, technician processes and customer equipment market by market in the acquired footprint. He said the company is nearing the point where it can “put a little more gasoline on the fire” and increase sales volumes under the AT&T brand.
Buybacks Raised as EchoStar Deal Nears Close
AT&T returned $4.1 billion to shareholders in the second quarter, including approximately $2.2 billion of share repurchases. Desroches said the company is on pace to repurchase nearly $1 billion of stock in July and now expects to buy back approximately $10 billion of shares in 2026, up from a prior target of $8 billion.
Desroches said the updated repurchase plan represents a pull-forward of planned buybacks through 2028. Combined with expected dividend payments, shareholder returns are expected to total approximately $18 billion this year, essentially matching the company’s full-year free cash flow outlook.
AT&T ended the quarter with net debt to adjusted EBITDA of 2.68 times, essentially flat with the first quarter. Desroches said AT&T expects leverage to rise to the 3.2 times range after closing its planned acquisition of spectrum licenses from EchoStar, which the company expects by the end of July, and then return to its target range of about 2.5 times within approximately three years.
Stankey said the board remains actively engaged on capital allocation and that the company’s decision to increase repurchases reflected what management sees as a gap between AT&T’s operating fundamentals and its stock valuation.
Copper Retirement, AI Traffic and Network Strategy
Stankey said AT&T made progress exiting inefficient copper-based services, helped by recent Federal Communications Commission actions. He said the FCC gave AT&T permission to discontinue legacy copper voice service at about 60% of its wire centers in California. Nationwide, AT&T has approval to discontinue legacy services in more than 30% of its wire centers, effective by late 2026.
Desroches said legacy segment service revenue declined 26% year-over-year, while EBITDA declined about 46% as AT&T accelerates the process of powering down its legacy copper network and migrating customers to more advanced voice and internet services.
Stankey also used the call to outline AT&T’s view of AI-driven network demand. He said agentic AI is changing network traffic in “volume, shape, symmetry, and criticality,” citing industry research showing AI agents can generate up to 450% more total traffic per task than a human performing the same work. He said agentic adoption is projected to drive approximately nine times growth in enterprise traffic and approximately seven times growth in consumer traffic by 2035.
Stankey said AT&T’s fiber and spectrum investments position the company to handle future demand for low-latency, high-bandwidth and uplink-optimized connectivity. In response to analyst questions, he said the company’s planned EchoStar spectrum acquisition and 600 MHz spectrum position should help support stronger wireless uplink performance.
AT&T also discussed leadership transition plans following the announcement that Desroches will retire at the end of the year. Stankey said Jennifer Biry will return to the company as CFO and described the transition as “deliberate and carefully planned.”
About AT&T (NYSE:T)
AT&T Inc is a global telecommunications company that provides a broad range of communications and digital entertainment services. Its core activities include consumer and business wireless services, broadband and fiber internet, and network infrastructure. The company operates branded wireless services through AT&T Mobility and deploys fixed-line and fiber networks to deliver high-speed internet and related home services.
AT&T’s product and service portfolio spans mobile voice and data plans, smartphones and device sales, home internet (including fiber-to-the-home where available), and managed connectivity solutions for enterprise customers.
