AT&T sees more customers are purchasing fiber broadband and wireless bundles 

OneConnect’s single subscription structure

One of the key developments in AT&T’s convergence vision is the launch of its OneConnect platform.

AT&T OneConnect offers consumers one subscription, one flat monthly price, and coverage for wireless and home internet across devices.

OneConnect could resonate with consumers who want to have a single bill for all their wireless and wireline connectivity. Consumers won’t have to deal with separate home internet and wireless accounts.

According to AT&T, 72% of customers prefer a single bill for connectivity across their devices, wherever they are, for a flat price.

AT&T sees the growing scale of its wireless and fiber broadband base as an advantage. The service provider reaches a total of 90 million customer locations across the country with its connectivity service via fiber or 5G. It also reaches 37 million customer locations with fiber, and it’s on track to reach 60 million plus locations by the end of the decade.

“We believe this provides us with more scalable reach and converged connectivity than any of our peers, including a meaningful scale and performance advantage in fiber,” Stankey said.

He added that when it completes the installation of fiber at a customer site, it can offer access at a lower cost than its competitors.

“This positions AT&T to compete on performance and value by putting our service at the center of our converged offers and shifting the focus away from expensive device subsidies,” Stankey said. “You saw us lean into this advantage with the launch of AT&T OneConnect, a single subscription service for fiber and wireless with a flat monthly price. This is how you should expect us to go to market as we accelerate the expansion of our fiber availability, with offers and marketing strategies that yield attractive returns by driving deeper fiber penetration and growth in converged customer relationships.”

Lumen’s effect

While it’s still early, Lumen’s acquisition will also affect AT&T’s fiber and, eventually, its bundled wireless and wireline base.

By acquiring Lumen’s fiber broadband business, AT&T added 1.1 million fiber customers and over 4 million fiber locations.

AT&T expects its fiber reach to grow by about 8 million locations in 2026, including over 4 million new locations it acquired from Lumen.

Stankey said it is making progress integrating the Lumen fiber assets in several major metro areas, to position its fiber business for further growth, and it is already seeing benefits.

“We now offer fiber services throughout our distribution channels in these areas, which has driven sales activity well above pre-transaction trends,” he said. “We're executing the steps to scale engineering, construction, and service delivery in the acquired geographies. As we move into the back half of the year, we expect to see steady improvement in fiber and wireless customer growth.”

Broadband drives revenues

Fiber-based broadband was once again a highlight of AT&T’s first-quarter earnings results, which rose 2.9% to $31.5 billion.

Likewise, AT&T’s service revenues were $22.9 billion for Advanced Connectivity, up 3.6% year over year.

Pascal Desroches, CFO and VP of AT&T, said the first quarter results reflected an increase in both wireline fiber broadband and its 5G wireless service base.

“Our growth is increasingly driven by gains in fiber and fixed wireless internet customers, as well as our success at growing customer accounts that choose AT&T for both internet and wireless connectivity,” he said.

Looking forward, AT&T expects 2-3% growth in fiber, wireless services, and its InternetAir fixed wireless service. Declines in transitional and legacy revenues will partially offset this growth.

Desroches said, “This is driven by our outlook for customer gains from our new unlimited and converted subscription plans, and our expanding opportunity to sell wireless and home internet services together.”

He added that this “reflects our recent pricing actions that take effect during the second quarter.”

Overall, first-quarter advanced home internet service revenues grew 27.3% year-over-year. These revenues include two months of revenues from fiber customers in geographies AT&T acquired from Lumen, which added about 650 basis points to its reported growth rate in the quarter.

Desroches said that “similar to wireless, our organic growth in Advanced home internet service revenue was primarily driven by growth in our customer base.”

AT&T added 512,000 new Advanced home internet service customers in the first quarter, excluding the 1.1 million customers it acquired from Lumen. As its best-ever first quarter, it included 273,000 fiber net adds and 239,000 internet Air net adds.

Advanced home internet revenue growth, which included two months of impact from the acquired Mass Markets fiber business, reflects increases in fiber and AT&T Internet Air revenues.

“As we ramp up our fiber reach, we expect to see improved trends in our fiber net adds over the course of the year, while accounting for typical seasonality,” Desroches said. “We are also seeing strong growth in our business fiber and advanced connectivity service revenues, which include business.”

Despite growth in fiber and wireless, the legacy service drag persists as AT&T continues to see declines in its legacy copper business.

Due to lower demand for services as AT&T continues to decommission its copper-based network, the telco’s legacy segment revenues declined 25.3% year over year.

AT&T stopped taking new orders for legacy services last year in most of its wireline footprint. It also got FCC approval to discontinue legacy services in more than 30% of our wire centers.

“We're actively working with customers in these areas and helping them upgrade to more advanced services like Internet Air and Phone Advanced,” Desroches said. “There is a lag between when customers migrate to more advanced services and when we can discontinue operations of legacy infrastructure. This is the primary reason the decline in legacy EBITDA of about 40% exceeded the decline in revenue. And we expect this dynamic will persist for the next several quarters.”

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