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AT&T beats wireless additions estimate on 5G demand, raises FY growth forecasts

© Reuters. FILE PHOTO: Shoppers walk past an AT&T store at the King of Prussia Mall in King of Prussia, Pennsylvania, U.S. November 22, 2019. REUTERS/Mark Makela/File Photo

(Reuters) -AT&T Inc on Thursday beat analysts’ estimates for monthly phone bill paying subscriber additions in the second quarter, fueled by more Americans upgrading to 5G phones.

The company, which also raised its full-year revenue and adjusted earnings per share growth forecasts, added 789,000 net new postpaid phone subscribers during the quarter, above FactSet estimates of 278,000.

The wireless carrier had lost 151,000 subscribers in the year-ago quarter at the height of the pandemic.

AT&T (NYSE:) has been shelling out billions of dollars to upgrade its networks to the 5G technology, as demand for the faster service surges with people working from home and learning online.

WarnerMedia, the company’s media unit that is being hived off to combine with Discovery, added 2.8 million U.S. subscribers for its premium channel HBO and streaming platform HBO Max during the quarter, thanks to titles like “In the Heights” and “Mortal Kombat”, which is based on the popular video game.

AT&T raised its forecast for global HBO Max subscribers to between 70 million and 73 million by the end of the year, compared with the earlier estimate of 67 million to 70 million subscribers.

Total revenue at AT&T rose 7.6% to $44 billion, beating analysts’ average estimate of $42.67 billion, according to IBES data from Refinitiv.

Higher WarnerMedia, mobility, Mexico and consumer wireline revenues more than offset declines in domestic video and business wireline revenues, AT&T said.

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AT&T now expects revenue growth in the 2% to 3% range and adjusted earnings per share to rise in the low- to mid-single digits.

The company had previously expected revenue growth in the 1% range and adjusted earnings per share to be stable with the previous year.

Net income attributable to common stock rose to $1.5 billion, or 21 cents per share, in the second quarter, from $1.2 billion, or 17 cents per share, a year earlier.

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