By Harshita Mary Varghese
July 22 (Reuters) – AT&T topped quarterly estimates for wireless subscriber additions on Wednesday as cheaper unlimited plans paired with bundled mobile-broadband offerings drew in value-conscious customers, sending its shares up 4%.
The gains build on AT&T’s broader convergence strategy of selling multiple connectivity services to the same household to reduce churn and increase customer lifetime value as U.S. telecom providers chase the same finite pool of users.
The bundled offerings also helped the company post record broadband additions, with 367,000 new fiber internet users and 279,000 fixed wireless subscribers.
AT&T in March launched OneConnect, a single subscription that bundles unlimited wireless service with home internet under one monthly bill.
It has also rolled out customizable Build-A-Plan options and new entry-level wireless plans with more high-speed data, while continuing to invest aggressively in expanding its fiber network.
AT&T added 432,000 net monthly bill-paying wireless subscribers during the April to June period, flying past estimates of 338,500 additions, according to FactSet.
“The cross-selling that they’ve been building towards, it’s actually showing up in the numbers right now,” said David Wagner, head of equity at Aptus Capital Advisors, which holds AT&T stock.
The numbers from AT&T show that the company is taking some market share, he said.
About 42.5% of homes using AT&T’s advanced internet services are also subscribing to its wireless.
CEO John Stankey said that targeted promotions and customer retention efforts helped attract users to its bundled offerings.
For the second quarter, total revenue stood at $31.6 billion, compared with estimates of $31.80 billion, according to data compiled by LSEG.
Adjusted earnings per share came in at 65 cents, compared with analysts’ average estimate of 59 cents.
AT&T reported free cash flow of $4.7 billion for the quarter, above Visible Alpha estimates of $4.43 billion.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Shinjini Ganguli)
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