T: Model Update Intra-Quarter Review

研报英文原文证据摘录

T: Model Update Intra-Quarter Review

AT&T Inc.

Takeaways from 1Q26 results and post-quarter developments (continued). 3) Broadband ARPU

trajectory under scrutiny. Management commentaries suggest the willingness to accept fiber

ARPU dilution in order to accelerate the penetration in the fiber footprint towards 50% and

support mobile cross-selling. While fiber ARPU growth of 1.7% included minor dilution from

the newly acquired Lumen footprint, we estimate that ARPU growth in AT&T's core footprint

was still under 2%, which we attribute to the continued push towards discounted bundled

offerings and the competitive environment overall, as cablecos are trying to find a recipe to

improve the subscriber trajectory at the expense of ARPU. In early May, the company lowered

its promotional offer for 1Gbps to $48/month from $65/month previously. We continue to

view industry developments as deflationary for the broadband industry and keep our FY26

fiber ARPU unchanged at a modest 1.4% growth y/y. The company's FWA business continued

to scale, with the majority of customers new to AT&T followed by a cohort of DSL customers

converted to fixed-wireless. 4) Wholesale fiber entity, Forged Fiber. The assets purchased

from Lumen on February 2, 2026, were put in a new subsidiary, Forged Fiber. Through 2026,

AT&T intends to sell a controlling interest in Forged Fiber to an equity partner that will co-

invest in the ongoing business. While AT&T recognizes the revenue from customers in Lumen's

footprint in the Advanced Connectivity segment, operating expenses of $95M in costs reflect the

wholesale commercial arrangements following the disposal. We estimate the network-related

costs represented ~60% of revenue in Lumen's footprint in 1Q26. Forged Fiber is classified as

discontinued operations.