per the usual for our coverage at this conference, AT&T Chairman and CEO John Stanky. John, good to see you. We were just here and now we're back.

It's it's good to always be back in California and be back with you.

Oh, thank you. I appreciate it. So, I was listening to your uh, I should say I was reading the transcript of your presentation here at the conference, talked a lot about fiber.

Why why is this so important uh for your company this year?

Look, I I've always had this belief that fiber is effectively the network you're building for the future. It's we don't have wireless networks and fixed networks. We have fiber networks that have different access technologies on them. And in our case, I think in order to have a pervasive fiber network that reaches out close to customers and then get the right access technology on it. Maybe it's a cell site, maybe it's a Wi-Fi access point, maybe it's a hard-wired connection into the wall.

At the end of the day, you want to get traffic onto fiber and the faster you can do that, the better the performance is going to be for a customer, the more reliable the network's going to be, the lower the marginal cost is going to be and that's how you win in a networking business.

How many households now have fiber and and where are you going with it?

We're just over 30 million now and we've stated that uh by the end of the decade we'll be at 20 at 60 million, so we've got another 30 roughly to build. Um, that's as we stand today. Never know what's going to change between now and the end of the decade, but uh we're pretty laser focused on the next 30 million that we need to build. We know where they are. We know what states, what neighborhoods,

the team's very focused on that. We're going to ramp to about a 4 million a year build by the end of next year, which is the largest in the country. And we think that's what keeps us in the lead as a converged network provider everybody else in the industry on the best technology as we move forward here.

What does the undertaking look like to build out fiber for millions of households across the country? What what do you have to do to make it all happen?

It it's kind of like building the transcontinental railroad when you think about it. It's a big civil engineering project. It's uh as great as fiber is and as wonderful the technology is, it's a uh it's a trenching project, right? It's about doing road work and repaving and all those kinds of things and that's not terribly sexy nor is it new technology, you know, boring technology and things like that is pretty mature. So you're working in in a very much a civil engineering project that requires a lot of coordination.

It's just like building the interstate highway system or the railroads. and 60 million homes is a lot. Um but uh you know, it's almost about half the United States and and we're going to be in a very unique position once that work's done.

Does that change the CAPEX demands on a business like yours?

It absolutely does. I mean, we're investing heavily right now. We're investing in some cases, you know, like 400 basis points higher than others in the industry. But the flip side of that is is once you build this scalable, incredible infrastructure that literally has unlimited capacity, when you're done with that, you're not investing and you're just collecting the fees for people using the services.

And the cash flow characteristics of the business changes pretty dramatically at that point. And that's that's why we're doing what we're doing here. We're building a business for the next decade. And when we finish this, not only will the US have incredible infrastructure, but the business is going to have very different cash flow generation characteristics that are going to be really, really good.

The financial complexion of your business has changed dramatically. I mean it's dramatically improved every year that you and I have sat at this conference and talked. when how how important is a dividend increase?

Well, it's very important to our investors and it's very important for us to make sure that we're consistent and we're protected and keep it at a competitive level. I watch the yield on the dividend frequently. It's it's actually been nice to watch the yield come down a little bit because that's an financials are improving. It's an indicator of confidence, right? And um, certainly to the extent that that yield gets into a place where it's not competitive with other companies like our size, we we would evaluate that with the board and decide do we want to adjust it? But right now,

we think the right answer is taking some shares back in and focusing on a little bit of share buyback. Uh you know, we issued a lot of equity when we had done some transactions in the past, that equity is still out there. I'd like to maybe pull that back in and resize the float on the stock a bit. and that's a great way to drive return and put some buoyancy in the stock price as well that everybody gets benefit from.

I uh of course, I'm sure you saw the SpaceX news buying $17 billion in spectrum from Echostar. I had your uh counterpart Hans Vestberg on set yesterday. He's he views SpaceX as complementary, doesn't necessarily see them going out there creating a cell phone business. How do you see it?

I I see it as mostly complementary. I think he's probably right about that. I I think one thing that people don't realize is that the hardest part about running a terrestrial mobile network is actually not covering the streets and the roads, it's covering inside the buildings in a hotel like this. It's in a hospital. It's in an arena, it's in a 50 story skyscraper where every floor has to have radiation because it's way above ground level.

Those are the harder things to do and satellite's not particularly well suited to meet those needs. Um and and as I think probably Echostar found out after years of investing to try to build a wireless network, it's not just about putting 50,000 cell towers out to do that and it's not enough to invest to make that happen unless you're investing on infrastructure on the interior and you have much deeper networks. 40 megahertz of spectrum for air to ground that they just bought,

you know, a cell radius is about 1.8 miles today. A spot beam from a satellite is bigger than that. There's 300 megahertz of spectrum sitting on a typical cell tower. 40 megahertz on a larger cell, you know, a spot beam is not going to cover the kind of population that's necessary in an urban metro area. So, probably in the near term hard to do without a partner.

But there's also a sense that SpaceX is not going to exactly go out there and put poles in the ground.

Yeah, it's it's hard to do without a partner, right? Um now could they come up with a creative approach to partner with somebody and over a very long period of time acquire the assets to become a fully uh infrastructure-based operator of a cell network, maybe, but our job is to make our networks better and faster and use the advantages we have on latency and scalability to put a better product out there that prevents any competitor from doing that.

It's not a chat for us without a little bit of uh talk about the economy. Now, Goldman's chief economist came up here on here yesterday said the economy is in stall speed. JP Morgan CEO Jamie Diamond said an interview today on another network, the economy is weakening. How do you see it?

Um look, our our customers are still aggressively buying our products and services and paying their bills and uh but I do know, I mean, I've got a lot of employees and I talk to folks and I know that there's a degree of stress in some segments of the consumer space. Costs of certain products and services are getting higher and that's putting some dynamics in place. I think some of that is tied back to um some uncertainty and maybe uncertainty around how do tariffs ultimately settle in on particular product families and products.

Um, I think the administration is working really hard to shift this economy and shift the dynamics of manufacturing in the United States. And this is a deliberate strategy around that. I think the longer that's in flux and not maybe more known, it adds uncertainty, which could slow down economic growth. Uh my sense is people are working as hard as they can to try to bring some degree of certainty with major trading partners including China that once that's known then businesses feel good to invest.

Certainly policy has been set up in a really effective way right now to drive investment. tax reform, what we're seeing in in regulations in our industry, that's all good. And that's why we're investing at record levels. I suspect other industries will see the same thing start to happen once some of that uncertainty clears up.

Are you excited about the prospect for rate cuts next year? Or even this year for that matter? I that has to be a big potential tailwind to a business like yours.

Well, for a guy who just decided to take our balance sheet from two and a half times adjusted net debt net debt to EBIDA to three, sure, I'd like some rate cuts and it would work out really well. I we we certainly in our calculation expected that rates are probably at a point right now where they be stable or stable to declining.

Um and that obviously will help things as we go out into the market to do that. and I would expect that they're going to at least continue to be stable or maybe even some downward bias to it. We'll see.

Uh it's good to always uh spend some time with you, John. We'll be back here about a year from now. Yeah, we'll see it from here. Time will fly. with a new iPhone. Yeah, new iPhone, iPhone 18. Uh or the 19. AT&T uh chairman and CEO John Stanky, always good to see you.