Time Warner Buy Remains Top Priority, AT&T CEO Assures Investors

October 25, 2017 by Howard Buskirk|Mergers & Acquisitions

AT&T released Q3 results after market close Tuesday, assuring investors its acquisition of Time Warner remains its top priority. “We look forward to closing” the acquisition “and bringing together premium content with world-class distribution to deliver a better entertainment experience for consumers and more effective targeted advertising,” AT&T CEO Randall Stephenson said. Stephenson said AT&T is pleased with its progress on FirstNet. “Already 27 states and territories have opted in, and we’re working closely with them as we prepare to deploy the FirstNet network,” he said. AT&T said it had 3 million total wireless net adds, including 2.3 million in the U.S. -- combining connected devices and prepaid and postpaid phones. It reported nearly 700,000 net adds in Mexico. Revenue fell to $39.7 billion vs. $40.9 billion in the year-ago quarter, “primarily due to declines in legacy wireline services and consumer mobility,” the company said. Net income attributable to AT&T was $3 billion v. $3.3 billion. AT&T expects to complete its buy of TW this year, Chief Financial Officer John Stephens said on a call with analysts. “The financing is set and we’re ready to close once we receive DOJ approval,” he said. "In the meantime, Time Warner continues to perform well, even better than our expectations." AT&T said it took a 4 cents-per-share hit Q3 from merger-related interest expenses and 2 cents hit as a result of natural disasters. The carrier also said it has already spent $200 million on its FirstNet build. AT&T’s strong response to the recent storms bodes well for the future of FirstNet, Stephens said. “It’s still a long road ahead" for the people of Puerto Rico and the U.S. Virgin Islands, "but we plan to be there every step of the way,” he said. "Recovery is progressing with additional equipment arriving daily. We are seeing traffic growing daily on our network as service is restored." Daily call volume is now about 75 percent of pre-storm levels, he said. The company is pleased with changes in Washington, especially the likely end of 2015 net neutrality rules and pending tax reform, Stephens said. “We see a change in the mindset across D.C. in promoting lighter-touch regulation and pro-growth initiatives.”