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Welcome to our Bloomberg TV and radio audiences worldwide. We bring in AT and T CEO John Stanky, the company reporting results this morning that showed higher than expected subscriber growth, though some analysts noting customer churn and average revenue per user showing signs of strain. John, It's great to have you back with us, you know.
With your story.
Thanks for having me.
You're welcome. It's like a simple story. You know.
The data from the quarter is very clear there was an element of promotion and marketing and deals that drove it.
But how would you summarize it.
Look, we had really strong growth, as you indicated, and we're really comfortable with our growth. As I think you're probably aware, we've been focusing on customers that want to buy both wireless and broadband from us and what we can do that and if it's promotional, that's a good customer to pick up because they have great lifetime values and over time they'll churn us and they'll address that very issue that you alluded to, which is the increasing
churn in the industry. And we kind of anticipate as we acquire these customers, we're going to see a little bit of hardpoop pressure, partly because we obviously give them a better price for their loyalty, and over time we move them up on the continuum services we sell. So excuse me, buy and large. We feel really good about it.
Oh, John, I don't know if you have some water there with you, Let me give you a second, just to take a quick drink if you need it. Of course, in the quarter, and we've discussed this with a number of the carriers, it was iPhone seventeen. You know, I was there at Kubatino Apple Park on the day of its release. Can you give us a real term sense, even if it's from the promotion perspective, of how big a fact of the iPhone seventeen was for you?
Well, I think it's it's not a huge factor, but clearly there was a little bit of suppressed activity after the last iPhone cycle a year ago. Maybe some folks anticipated it was going to be a little bit larger customers were seeing if it was really frame breaking and change and concluded possibly that it wasn't and delayed waiting for the next cycle. And I think you can only suppress that activity for so long, and now the new
device comes out, people see what it is. So there has been an increase over last year and maybe some other previous years. It's not a record breaking cycle, but it's strong and we're seeing that as a result. But I don't think it's anything dramatically out of pattern, given the suppression we've seen in the market, and we were very effective at working through at four hundred thousand over four hundred thousand postpaid vone netads. It shows we can compete in that space and do well with it.
If you're joining us on Bloomberg Television and Radio. We're speaking to AT and tco John Stanky final on the iPhone seventeen. Will it be more of a factor in the three month period that ends in December?
The holidays, Well, the holiday season moving through the fourth quarter is always a peak season for everybody in the industry. I expect that's going to continue to be the case this year. I don't see anything what we've had over the first couple of weeks of the introduction to suggest we're going to see a step function change from current
rate and pace. So all of our forward guidance that we've given expects that it's going to be competitive, that we're going to compete and continue to earn our fair share of service revenues on those converged customers I talked about, and I expect that it'll be as rambunctious in the industry as it has been and we'll do just fine.
John.
If I turn on my television and watch a show that has adds or a scroll on any given social media timeline, I keep seeing AT and T talking about itself as a home internet provider.
I know that's been a priority.
Have you any evidence that that push has been a success and that you have positioned AT and T in that domain.
Well, I'm glad you're seeing those means we must be getting our right market and targets out there, and I think this quarter was an excellent example of it. We had our best broadband gain on our strategic products and services fixed, wireless and fiber that we've had in eight years, and so over five hundred and fifty thousand ADS on those strategic products and a net gain of over two hundred and thirty thousand of broadband total. It's the best
we've done in eight years. I think that's a good strong indication that it's working, especially when you consider the industry has been rife with examples of our competitors adjusting their offers, trying to do different things to stem the
momentum we've had. So I feel really good about where we're going on that front, and to the effect we can add that with wireless subscribers, which we're showing that we can do over fifty percent of the time when somebody buys our fixed wireless product and we're over forty one percent penetrated on our fiber base, that's a winning combination economically and what kind of differentiates us from everybody else in the industry.
Okay, shares a down a touch more than one percent, which in the grand scheme of today is modest, is a decline. The back and forth you had with the analyst was, yes, churn is up and arpus are down, but you seem not to be concerned about that. Why Why is that not the metrics by which we should should look to progress.
Yeah, it's part of it, I think ed as well as we've got a little bit of churn going on in the industry from CEO changeouts, and there's a little uncertainty around what the competitive posture is going to be.
And then you look at the data points you just reference and we're the first to report, and people are asking, you know, what's going to happen when we hear from everybody else, And my answering your question is, we're going to talk about the fact that we're focused on putting customers together with wireless and broadband, and part of that dynamic is go penetrate segments that we've not been successful
at penetrating or as successful. So when we go to value segments that were maybe a little under shared in you're going to naturally have a little bit less urpoo or average revenue per user when you pick that customer up. And when you combine wireless and broadband together, you may be giving initially a little bit better deal to do that, but that's designed into the plan. We want to grow and aggregate service revenues, which we've demonstrated that we can
do that. We indicated we're going to see some strengthening of that as we move through the year from where we were this quarter. And I'm okay with a little bit lower urpoo if we actually execute on this consolidated customer strategy or more successful at penetrating some of these segments that we haven't been as active in.
John Stanky at and TCO, it's great to have you back here on Bloomberg Tech.
Thank you very much,