AT&T eyes nearly $48 billion network investment in post-media venture

Signage for an AT&T store is seen in New York October 29, 2014. REUTERS/Shannon Stapleton

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March 11 (Reuters) – AT&T Inc (TN) plans to invest about $48 billion by the end of 2023 to expand its fiber optic and 5G wireless internet services, the U.S. mobile operator said on Friday , detailing the vision of the company after the denouement. its media assets.

After facing shareholder skepticism over its costly quest to become a media and entertainment company, AT&T is working to merge its WarnerMedia unit with Discovery Inc in a deal expected to be completed in the second quarter. The company plans to refocus on its core business, which is to offer internet and telephone services. Read more

“As the closing of the agreement with WarnerMedia approaches, we are close to the starting line of a new era for AT&T,” AT&T Chief Executive John Stankey said in a press release ahead of a presentation. to analysts on Friday.

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AT&T shares rose more than 3% to $24.09 in premarket trading.

AT&T said it expects annual capital investment to be in the range of $24 billion this year and in 2023. It will then decline to $20 billion beginning in 2024.

The company is working to double its fiber optic internet availability to reach 30 million homes in the United States and expand its 5G network to cover more than 200 million people.

AT&T also provided full-year financial guidance on Friday that excludes WarnerMedia’s Xandr business and advertising unit, which AT&T agreed to sell to Microsoft in December.

The company said it expects low-single-digit percentage growth in total revenue in 2022, unchanged from its previous outlook.

It also provided an outlook for 2023 for the first time, with continued single-digit percentage revenue growth and adjusted earnings per share of between $2.50 and $2.60.

After closing the deal with WarnerMedia and Discovery, the company expects to pay just over $8 billion in total annual dividends, AT&T said.

Free cash flow for standalone AT&T is expected to be around $16 billion this year and around $20 billion in 2023.

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Reporting by Sheila Dang in Dallas Editing by Nick Zieminski

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Cathy W. Howerton