AT&T (T) announced on Friday that its chief executive officer Randell Stephenson will retire after a 13-year tenure and will be replaced by the telecom and media giant’s Chief Operating Officer John Stankey.
Stankey who will take over as CEO on July 1, will join the company’s Board of Directors on June 1. He has been holding the COO post since October 2019. Stephenson will serve as Executive Chairman of the Board of Directors until January 2021 to support the leadership transition.
AT&T had been searching for Stephenson’s successor since 2017 and most recently finalized a 5-month intensive search process to select a CEO who could lead the company “during these challenging economic times”.
Commenting on the leadership change U.S. President Donald Trump called the succession “great news”.
“Randall Stephenson, the CEO of heavily indebted AT&T, which owns and presides over Fake News@CNN, is leaving, or was forced out,” Trump said in a Twitter post. “Anyone who lets a garbage “network” do and say the things that CNN does, should leave ASAP. Hopefully replacement will be much better!.”
The succession announcement comes in the same week AT&T released its first-quarter earnings reporting that revenue declined 4.6% year-over-year, 2% worse than expected, mostly due to lower growth at WarnerMedia and Latin America. AT&T reassured investors that it had sufficient free cash flow to commit to its dividend payout, but withdrew its 2020 financial outlook due to the lack of visibility related to the COVID-19 pandemic and recovery.
Stankey, a AT&T veteran, joined the company in 1985 serving in a number of roles, including: CEO of WarnerMedia; CEO of AT&T Entertainment Group; Chief Strategy Officer; Chief Technology Officer; CEO of AT&T Operations; and CEO of AT&T Business Solutions.
Wall Street analysts have a Hold consensus rating on AT&T’s stock split into 13 Holds, 6 Buys and 2 Sells. The $33.40 average price target indicates 12% upside from the current share price. (See AT&T stock analysis on TipRanks).
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