AT&T quarterly profit tops estimates, shares rise

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NEW YORK (Reuters) – AT&T Inc (T.N) said on Wednesday that quarterly profit beat Wall Street analyst estimates, helped by impacts from tax cuts and wireless subscriber additions.

Net income attributable to AT&T was $19.0 billion, or $3.08 per share, in the fourth quarter ended Dec. 31, up from $2.4 billion, or 39 cents a share, in the year-earlier period.

Excluding items, the No. 2 U.S. wireless carrier reported earnings of 78 cents per share, which included a 13-cent impact from tax cuts signed into law by U.S. President Donald Trump late last year. Analysts on average were expecting earnings of 65 cents per share, according to Thomson Reuters I/B/E/S.

Shares rose 2.5 percent to $38.40 in after-hours trading.

AT&T is aiming to complete its $85.4 billion acquisition of Time Warner Inc (TWX.N). The U.S. Department of Justice sued to block the deal last year, and a trial is slated to begin on March 19.

“While we remain open to finding some reasonable solutions to address the government’s concern, we do expect this case will ultimately be litigated in court,” said Chief Executive Randall Stephenson on the company’s post-earnings conference call, adding “we remain very confident that we’ll complete this merger.”

Revenue was $41.7 billion, compared with $41.8 billion in the year-earlier period. Analysts had expected $41.2 billion.

AT&T also said it added 329,000 phone subscribers who pay a monthly bill in the quarter, compared with a loss of 67,000 a year earlier.

For 2018, AT&T said including impacts from tax cuts and a new accounting standard, it expects earnings per share in the $3.50 range, free cash flow of about $21 billion and capital expenditures of $25 billion.