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Press Release -- March 11th, 2020
Source: AT&T
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John Stephens Updates Shareholders

AT&T Senior Executive Vice President and CFO John Stephens Updates Shareholders

John Stephens, senior executive vice president and chief financial officer of AT&T Inc.* (NYSE:T, news, filings), spoke today at the Deutsche Bank Media, Internet & Telecom Conference where he provided an update to shareholders.

Impact of Coronavirus. Stephens briefly discussed AT&T’s reaction to the coronavirus. He expressed his sympathy for everyone affected. He said the company is focused on its employees and customers and has taken precautions to help protect their health and safety. He also said the company is applying lessons learned from network disaster recovery efforts in coordinating with the authorities on the response to the virus. Stephens said that while he can’t speak on behalf of any specific supplier, the company hasn’t seen a significant impact in its supply chain at this point.

Increasing Shareholder Value. Under each of two outstanding accelerated share repurchase (ASR) agreements, AT&T will retire $4 billion of its common stock. Depending on market conditions, the two ASRs, combined with open market repurchases, are expected to bring total common shares retired in 2020 to more than 250 million through April.

Stephens also said the recent addition of preferred equity to its capital structure has been well received. AT&T will also continue to retire debt with the goal of a net debt-to-adjusted EBITDA ratio in the 2.0x to 2.25x range by the end of 2022.

5G and Wireless. Stephens said that AT&T has identified several drivers of wireless momentum in 2020 and is positioned very well to compete in any wireless industry structure. AT&T expects the successful launch of AT&T TV will drive store traffic in addition to bundling opportunities. HBO Max is also a key part of AT&T’s strategy; it will enable the company to pair unique premium video content with wireless, pay TV and broadband. Stephens said he expects bundling opportunities will also increase Unlimited plan adoption, with 5G initially available only on AT&T’s upper tier Unlimited plans.

Premium TV and HBO Max. Stephens said the company expects AT&T TV to be an important part of AT&T’s portfolio of services in 2020.He also said that AT&T’s initial focus for the HBO Max streaming platform will be on the domestic launch and securing uptake among existing HBO customers and then expanding to other customers, including via attractive bundling offers. The company has very high expectations for HBO Max, including the possibility of increasing adoption of higher ARPU services and strengthening the long-term value proposition of its highest value customers.

Fiber and Broadband. Stephens said that AT&T has a significant opportunity to grow penetration in its fiber footprint, both with consumers and businesses. The company has seen significantly better bundling rates for broadband with AT&T TV, given the more natural fit with the software-based, broadband-delivered service.

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