AT&T (NYSE:T) saw its shares rise 1.9% to $22.52 in Tuesday morning trading on the New York Stock Exchange, recovering from a 52-week low as investors rotated into large U.S. telecom stocks. The move came amid a broader sell-off in technology shares, with the Invesco QQQ Trust (NASDAQ:QQQ) dropping approximately 2.5%. Verizon Communications (NYSE:VZ) added 1.4%, and T-Mobile US (NASDAQ:TMUS) gained 1.3%.
The bounce, however, appears more technical than fundamental, as AT&T shares remain under pressure. The stock's 52-week range, as reported by MarketWatch, is between $21.99 and $29.79. AT&T has declined 3.65% over the past five trading days and is down 10.81% for the month, suggesting Tuesday's uptick does not yet signal a sustained shift in sentiment.
Investor attention is now firmly fixed on AT&T's second-quarter earnings, scheduled for release before the New York Stock Exchange opens on July 22, followed by a conference call at 8:30 a.m. Eastern Time. Analysts will be closely monitoring wireless subscriber additions, fiber broadband demand, and cash generation metrics. The company's guidance for 2026 includes low-single-digit service revenue growth, adjusted EBITDA growth of 3% to 4%, and adjusted earnings per share between $2.25 and $2.35. Capital investment is planned at $23 billion to $24 billion, with free cash flow expected to exceed $18 billion.
AT&T's strategy centers on locking in more wireless and fiber customers. In the first quarter, the company added 294,000 new postpaid phone subscribers and 512,000 consumer advanced internet customers, including 273,000 fiber additions and 239,000 AT&T Internet Air subscribers. Revenue for the first quarter totaled $31.5 billion, surpassing the $31.25 billion consensus estimate from LSEG data, as reported by Reuters.
Analyst sentiment remains cautiously optimistic. UBS analyst Ryan Gravett maintained a Buy rating on AT&T with a $31 price target, according to TipRanks. Meanwhile, UBS's John Hodulik kept a Hold rating on Verizon with a $48 target. The average analyst target for AT&T is $31.07, with a Moderate Buy consensus.
AT&T Chief Financial Officer Pascal Desroches recently told investors that the company is “delivering returns to shareholders today” while maintaining network investment. He emphasized that “fiber is our lead offer,” with fixed wireless access positioned as a selective option rather than the primary broadband product. This focus on fiber is central to AT&T's long-term growth narrative, as management believes data consumption will drive future revenue.
Brian Mulberry, chief market strategist at Zacks Investment Management, told Reuters that AT&T's first-quarter numbers indicate substantial spending, with the bet that “data is going to be the revenue of the future.” This bullish view suggests that front-loading investment now could smooth revenue streams over time.
However, risks remain. AT&T's second-quarter free cash flow outlook of $4 billion to $4.5 billion fell short of the $4.6 billion analysts had anticipated, as reported by Reuters in April. Additionally, California regulators have asked a court and the Federal Communications Commission to block AT&T's effort to shut down some legacy copper-wire phone services, citing “carrier of last resort” rules that require the company to maintain basic service even at higher costs. AT&T estimates that maintaining the California copper network costs approximately $1 billion annually, and copper now reaches only 3% of its households in the state.
Any slowdown in regulatory proceedings or weaker-than-expected fiber and wireless adoption could quickly erase Tuesday's gains. The stock remains volatile, and the upcoming earnings report will be a critical test for the company's turnaround narrative.
