About AT&T Inc.
If there's a way to communicate, there's a good chance AT&T Inc. provides it. The company offers wireless, wireline, satellite, WiFi, IP network, Virtual Private Network, and fiber optic cable services. It is one of the biggest wireline and wireless providers in the US with more than 174 million subscribers. It offers digital TV, voice, and internet service through its U-verse brand and satellite Pay-TV through DIRECTV. AT&T acquired Time Warner Inc. in 2018 after winning a court challenge by the US government. The deal added Time Warner's content such as HBO and CNN to AT&T's distribution capabilities. The US supplies more than 90% of revenue.
AT&T's Communications segment is its biggest segment, generating about 85% of revenue. The unit provides wireless and wireline telecom, video, and broadband services to consumers in the US and businesses in the US and around the world. Parts of the Communications segment are: the Entertainment Group, which provides video, internet, interactive, and targeted advertising and voice services to residential customers in the US as well as the DIRECTV and U-verse services; Consumer Mobility, which serves business, governmental, wholesale customers, and individual subscribers who purchase wireless services through employers; and the Business Wireline segment, which provides advanced IP-based services, as well as traditional voice and data services to business customers.
The WarnerMedia segment, more than 10% of revenue, develops, produces and distributes feature films, television, gaming, and other content globally. Media properties include Turner; Home Box Office; and Warner Bros.
The WarnerMedia Segment (more than 10% of revenue) develops, produces and distributes feature films, television, gaming and other content in various physical and digital formats globally. This segment includes Turner, HBO, and Warner Bros.
The company’s Latin America segment, about 5% of revenue, provides entertainment and wireless services outside the US. This segment contains the Vrio and Mexico businesses.
AT&T operates an advertising service, called Xandr, that develops targeted advertising based on data analysis from the company’s 170 million customer relationships.
Dallas, Texas-based AT&T has tried to increase its international telecommunications operations, but still gets more than 90% of revenue from the US. Mexico and Brazil are two its biggest international markets.
Sales and Marketing
AT&T is nothing if not ubiquitous. The company is a big advertiser to businesses and consumers with presence on TV, print, and online. The company operates its own retail stores where it offers smartphones from major manufacturers such as Apple and Samsung. The company spends more than $5 billion a year on advertising.
AT&T's revenue has risen at a 7% annual rate for the past five years, which includes a year of lower revenue (2017).
The company added about $10.2 billion to its top line in 2018, with sales hitting $170.7 billion. The 2018 increase was mostly due to the Time Warner acquisition and growth in the Xandr segment. The Communication segment’s sales fell under pressure from developing technology and shifts in customer behavior (although equipment sales were higher).
Net income dropped about $10 billion from 2017 to $19.4 billion in 2018. The difference was a tax benefit received from the US Tax Cuts and Jobs Act in 2017 as opposed to a tax payment in 2018.
AT&T’s cash holdings dropped to $5.5 billion in 2018 from $50.9 billion in 2017 as the company spent about $44 billion on acquisitions, including Time Warner, in 2018. Operations generated $43.6 billion in 2018, while investing activities used $63.1 billion and financing activities used $25.9 billion.
As the US wireless phone market becomes saturated (AT&T and Verizon count more than 280 million subscribers between them), carriers are looking for ways to generate more traffic on their networks to generate revenue. AT&T Inc. bought a content carrier, DIRECTV, in 2015. AT&T added to it content capabilities with the 2018 acquisition of Time Warner and its properties such as HBO and CNN. With those assets in hand, AT&T sold its stake in the Hulu streaming service to Hulu for $1.4 billion. AT&T said it would use the proceeds to reduce debt. The sale makes way for AT&T to provide its own streaming video service in 2019.
One concern is whether HBO can maintain its cultural cache, built on series such as The Sopranos and Game of Thrones that were developed under Hollywood-oriented leadership, under the telecommunications-focused AT&T.
In 2019, AT&T intends to build on its early mobile 5G network milestones reached in 2018 when it launched a version of the service in parts of a dozen cities.
In 2018, AT&T began work on FirstNet, a government funded nationwide network for first-responders and public agencies. A possible bonus AT&T would be excess wireless capacity that it could use for its paying customers.
Mergers and Acquisitions
AT&T acquired AppNexus, a digital advertising firm, in 2018 for a reported price of $1.6 billion. With AppNexus, AT&T seeks to speed the growth of its advertising platform. The purchase brings to AT&T some 400 software engineers and product managers with experience in machine learning and predictive analytics, advertising technology, and video. AT&T intends to integrate AppNexus's technologies with AT&T's first-party data, premium video content, and distribution.
In 2018 AT&T acquired AlienVault, a cybersecurity firm, adding to its communications security offerings.
AT&T's acquisition of Time Warner for $85 billion, a process that began in 2016, concluded in 2018. Time Warner's holdings include HBO, CNN, TNT, TBS, and the Warner Bros. Studio, which produces movies such as the Harry Potter franchise and TV shows (such as the Big Bang Theory).
208 S AKARD ST
Dallas, TX 75202-4295
Phone: 1 (210) 821-4105
Employer Type: Publicly Owned
Stock Symbol: T
Stock Exchange: , NYSE
SEVP, External and Legislative Affairs, AT&T Services, Inc.: Robert W. Quinn
SEVP and CFO: John J. Stephens
Chairman and CEO: Randall L. Stephenson
Employees (This Location): 590
Employees (All Locations): 268,000