During the July to September timeframe, the U.S. telecom company gained 403,000 net monthly bill-paying wireless subscribers, surpassing Visible Alpha's forecast of 393,430.
The introduction of premium plans has allowed AT&T to maintain its competitive edge in the increasingly saturated U.S. telecom landscape, where competitors like Verizon and T-Mobile are enhancing their offerings with streaming services such as Netflix and Max to draw in customers.
There has also been a rising interest in AT&T's bundled plans that combine high-speed fiber internet with wireless phone service at a discounted rate. The company reported that 40% of its fiber customers also choose its wireless plans.
Analyst Craig Moffett from MoffettNathanson noted that AT&T's convergence strategy may prove expensive, as the most lucrative markets have already been tapped, leading the company to focus on lower-density areas, which typically incur higher costs and yield lower returns.
AT&T's stock increased by 1.8% following the announcement of an adjusted profit of 60 cents per share, which exceeded the anticipated 57 cents, based on data from LSEG.
Similar to Verizon, AT&T's total revenue for the third quarter was $30.2 billion, which fell short of the $30.44 billion estimate, primarily due to a decline in phone upgrade volumes.
Additionally, a quicker-than-expected drop in customers from its legacy fixed-line division serving businesses also affected revenue.
Looking ahead to the fourth quarter, AT&T anticipates an uptick in phone purchasing activity, upgrades, and promotional efforts.
In the third quarter, its fiber segment added 226,000 customers, falling short of the expected 257,860 additions, as a work stoppage that began in August in the southeastern region hindered fiber installation efforts.
Operating expenses increased by 14% to reach $28.1 billion, surpassing LSEG-compiled estimates of $22.31 billion. This rise was influenced by AT&T's $4.4 billion impairment charge associated with its business wireline unit.