The stock market was largely flat on Thursday morning as investors anxiously awaited news on the ongoing stimulus talks, but AT&T (T 0.57%) was a big standout. As of 11:30 a.m. EDT, shares of the telecommunications giant were trading about 5% higher -- a large move for the typically low-volatility stock.
Given that we're well into earnings season, it probably won't come as a surprise that AT&T's third-quarter results are the reason for that share price move.
The company met expectations for adjusted earnings of $0.76 per share, but its revenue figure came in about $800 million higher than analysts had anticipated. The number of phone service subscribers unexpectedly grew by about 645,000 during the quarter, which was notably about twice the number of additions reported by rival Verizon.
The company also reported a total of 38 million U.S. subscribers for HBO and HBO Max, a gain of 1.7 million since the end of the second quarter. Management had previously set a year-end target of 36 million, so it's fair to say that this part of its pay-TV/streaming media segment is performing better than anticipated.
Even after Thursday morning's move, AT&T's stock price is still down by about 28% year to date, and for good reason. Movie theater closures continue to impact the company's WarnerMedia division, its DirecTV subsidiary continues to shed customers, and pandemic-related uncertainty has increased investors' concerns about the company's massive debt load. And although revenue beat expectations, it was still down by about 5% year over year.
So, while these quarterly results are definitely a step in the right direction, AT&T still has a long way to go before shareholders' lingering concerns are truly alleviated.