AT&T Increases Sales but Misses Estimates on Earnings

AT&T (NYSE: T  ) reported earnings on Jan. 26. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), AT&T beat slightly on revenues and missed on earnings per share.

Compared to the prior-year quarter, revenue increased and earnings per share dropped to a loss.

Margins shrank across the board.

Revenue details
AT&T notched revenue of $32.50 billion. The 28 analysts polled by S&P Capital IQ anticipated revenue of $31.98 billion. Sales were 3.6% higher than the prior-year quarter's $31.36 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
Non-GAAP EPS came in at $0.42. The 32 earnings estimates compiled by S&P Capital IQ averaged $0.43 per share on the same basis. GAAP EPS were -$1.12 for Q4 versus $0.17 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 46.2%, 910 basis points worse than the prior-year quarter. Operating margin was -18.7%, 2,500 basis points worse than the prior-year quarter. Net margin was -20.5%, 2,380 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $31.78 billion. On the bottom line, the average EPS estimate is $0.59.

Next year's average estimate for revenue is $127.95 billion. The average EPS estimate is $2.43.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 5,351 members out of 5,793 rating the stock outperform, and 442 members rating it underperform. Among 1,274 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,211 give AT&T a green thumbs-up, and 63 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on AT&T is outperform, with an average price target of $31.56.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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