AT&T subscriber growth driven by ‘consistency and simplicity,’ EVP says

AT&T Mass Markets EVP & GM Jen Robertson joins Yahoo Finance to discuss AT&T earnings, subscriber growth, and the state of delinquencies amid economic uncertainty.

Video Transcript

BRIAN SOZZI: AT&T out with an earnings beat this morning here amidst some strength in the wireless part of its business here. Let's bring in Jen Robertson, AT&T mass markets executive vice president and general manager. Jen, good to see you again. The vibe on Wall Street is that they give you credit for this quarter, but are concerned that some of these trends just may not continue. What's your level of confidence in that?

JEN ROBERTSON: Thank you for having me back. It's good to see y'all again as well. And what I would tell you is, we have momentum coming out of 2022 and are very, very proud of the results that we were able to put up growing not only subscribers, but revenue and EBITDA last year. And so feeling good about going into 2023 and certainly including any external factors into our guidance as we look forward.

JULIE HYMAN: And so when you're looking at the increases that you all make, Jen, in subscribers, what do you think are the big drivers here? Do you think it is promotions and discounts, or is there something else at work here?

JEN ROBERTSON: It's the common question across the industry right now. And what I would tell you is, it's consistency and simplicity when it comes to interacting with our customers. We made a commitment 2 and 1/2 years ago to be customer centered and to double down, whether it's with respect to the products and the pricing in the marketplace so that they can understand it and get what we promised, whether it's respecting and valuing the loyalty of our customers-- and that shows in our fourth quarter churn numbers-- but also evolving our distribution model so that we meet customers where they want to be met.

And so bringing all of those pieces together has created the ability to have sustainable growth and to both grow top line, but also expand our margins at the same time.

BRAD SMITH: What are you seeing among customers' ability to pay right now, Jen, and is that overflowing into any type of delinquency, whether kind of increased or perhaps even decreased? What's been the net effect?

JEN ROBERTSON: You know, I think we've shared our commentary on customers and payments. And as an industry, but across all industries, we are feeling the impacts of external factors. Certainly have that baked into 2023, but as we think about our focus on 5G and on wireless and fiber, and we think about our ability to be streamlined and nimble in response to the marketplace, we feel good about being able to adjust. And that's what we were able to do in 2022 and expect to have that same flexibility as we go through 2023.

BRIAN SOZZI: Jen, pretty sizeable impairment charge, I believe, in the wireless business in the quarter. Is that AT&T preparing for a pretty severe economic slowdown later this year?

JEN ROBERTSON: You know, I think those facts are available on our investor relations website. And Pascal Desroches, our CFO, addressed that in this morning's earnings call. So I'd really encourage people to access that material and take a look at what those write-offs were associated with. They were non-cash in nature and so certainly didn't impact our free cash flow for either period.

BRAD SMITH: When you think about spending to build out the network even more, we've continued to see some of the network and infrastructure investments being made across the industry. What does that look like in order to make sure that there is that added connectivity that the customers expect, lower latency as well, even as there is a competitive environment that really moves companies to respond to that demand from customers?

JEN ROBERTSON: We're excited about the growth of our networks and our commitment to bring fiber to 30 million households by the end of 2025. And we restated that again this morning that we're staying focused on 30 million households in our footprint by that time. And so that equates to about 2 to 2 and 1/2 million households a year. And we have the flexibility as we go quarter by quarter to adjust to ensure we hit that target.

And then on the 5G wireless side, again, saying we will bring our c-band or mid-band spectrum to 200 million households by the end of this year. And so being able to deliver both of those high speed networks is what we do. We do it exceptionally well. And then having the products and the offers on the back side of that to connect customers is how we've really differentiated ourselves over the last couple of years.

BRAD SMITH: AT&T mass markets EVP and GM Jen Robertson. Thanks for taking the time here with us today, Jen, to break down some of the earnings.