AT&T Inc. (NYSE: T) shares edged lower in premarket trading Monday, slipping 0.3% to $24.80 ahead of the New York Stock Exchange open, as the broader market showed modest gains. The telecom giant's stock is under the spotlight as investors brace for second-quarter results and a key appearance by Chief Financial Officer Pascal Desroches at the Mizuho Technology Conference on June 9.
Free cash flow remains the central metric for AT&T, which is navigating a period of heavy capital expenditure on fiber-optic expansion and 5G network upgrades. The company has projected Q2 free cash flow in the range of $4.0 billion to $4.5 billion, a critical benchmark for a firm that must balance dividend payments, share buybacks, and debt reduction. In the first quarter, free cash flow came in at $2.5 billion, down from $3.1 billion a year earlier, due to increased capital spending.
AT&T's near-term narrative is less about artificial intelligence hype and more about operational execution. The company is focused on building out its fiber and wireless services while managing its debt load, which includes approximately $23 billion spent on EchoStar spectrum assets—a deal that received FCC clearance in May. The company reiterated its full-year free cash flow target of "$18 billion plus" and longer-term goals through 2028 of higher adjusted EBITDA and stronger cash generation.
Key Dates and Market Sentiment
Investors have two key dates on the calendar: June 9, when CFO Desroches speaks at the Mizuho conference, and July 22, when AT&T reports second-quarter earnings before the NYSE open, followed by an 8:30 a.m. ET conference call. The company's stock has been under pressure, trailing the broader market, which saw the SPDR S&P 500 ETF (SPY) tick up slightly. Rivals Verizon (VZ) and T-Mobile US (TMUS) also slipped, down roughly 0.4% and 0.9%, respectively.
Wall Street remains cautiously optimistic, with J.P. Morgan analyst Sebastiano Petti maintaining an Overweight rating and a $33 year-end price target, as reported by Barron's. Petti cites AT&T's fiber spending, the convergence of wireless and home internet services, and plans for higher EBITDA and free cash flow per share through 2028 as key drivers.
Operational Highlights and Risks
In the first quarter, AT&T reported revenue of $31.5 billion, up 2.9% year over year, with adjusted earnings of 57 cents per share. The company added 584,000 advanced internet customers, split roughly evenly between fiber and fixed wireless, and 294,000 postpaid phone subscribers. Notably, 42% of advanced internet customers also use AT&T's wireless service, indicating traction for its bundled fiber and mobile offers.
CEO John Stankey told investors on the April earnings call that there was "clear evidence" of progress on the fiber and 5G strategy. However, risks persist. If wireless service revenue stalls, customer churn rises, or fiber investment takes longer to pay off, cash flow could tighten. The company's substantial debt and spectrum obligations add to the pressure for tangible returns.
Broader market indexes were higher Monday, lifted by AI-related gains in Nvidia (NVDA) and Microsoft (MSFT), while investors also monitored oil prices and U.S.-Iran tensions. AT&T's focus remains on its core telecom operations, with the June 9 CFO appearance likely to provide more clarity on the path to meeting its 2026 and longer-term targets.
