AT&T INC.
For the period ended Mar 31, 2025. Filed Apr 29, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed Apr 29, 2025
T$21.63-0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-10-29.
0000732717-24-000059
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-04-29.
0000732717-25-000023
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 87 previous paragraphs and 84 current paragraphs.
25 unchanged; 45 reworded; 14 added; 17 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 17 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Operations and support expenses increased in the first quarter of 2025, primarily due to higher Mobility equipment costs resulting from increased wireless equipment sales volumes and higher restructuring charges. These increases were partially offset by expense declines from our continued transformation efforts and lower network-related costs, which included lower negotiated rates and higher vendor settlements in 2025, and the absence of expenses from our cybersecurity business that was contributed to a new cybersecurity joint venture, LevelBlue, in the second quarter of 2024.
Current report
Equity in net income of affiliates increased in the first quarter of 2025. The increase reflects cash distributions received by AT&T in excess of the carrying amount of our investment in DIRECTV (see Note 9).
Current report
tax. Our effective tax rate was 21.7% in the first quarter of 2025, versus 23.0% in the comparable period in the prior year, reflecting larger discrete state tax benefits in 2025.
Current report
Segment Results Our segments are comprised of strategic business units or other operations that offer products and services to different customer segments over various technology platforms and/or in different geographies that are managed accordingly. We evaluate segment performance based on operating income as well as EBITDA and/or EBITDA margin. See “Discussion and Reconciliation of Non-GAAP Measures” for a reconciliation of EBITDA and EBITDA margin to the most comparable financial measures calculated and presented in accordance with U.S. generally accepted accounting principles.
Current report
Depreciation expense increased in the first quarter of 2025, primarily due to ongoing capital spending for network upgrades and expansion, partially offset by lower depreciation impacts from our network modernization efforts.
Current report
Operating income increased in the first quarter of 2025. Our Mobility operating income margin in the first quarter decreased from 31.4% in 2024 to 31.2% in 2025. Our Mobility EBITDA margin in the first quarter decreased from 43.5% in 2024 to 43.0% in 2025.
Current report
Fiber and advanced connectivity services revenues increased in the first quarter of 2025, driven by higher fiber and fixed wireless revenues.
Current report
Equipment revenues remained constant in the first quarter of 2025.
Current report
Equipment revenues decreased in the first quarter of 2025, reflecting unfavorable foreign exchange impacts, partially offset by higher equipment sales.
Current report
During the first three months of 2025, cash provided by operating activities was $9,049, compared to $7,547 for the first three months of 2024, with increases resulting from higher cash flows related to DIRECTV, including a first-quarter 2025 dividend of $1,138, and operational growth.
Current report
For the first three months of 2025, cash used in investing activities totaled $4,958 and consisted primarily of $4,277 (including interest during construction) for capital expenditures. During the first three months of 2025, investing activities also included $95 of FirstNet sustainability payments net of reinvestment, and approximately $560 for our investment in a new strategic partner related to wireline network transformation accounted for under the equity method of accounting.
Current report
Financing activities in the first three months of 2025 also included the issuance of $2,250 of nonconvertible cumulative preferred interests in Telco LLC, with the funds used to redeem all outstanding Series B preferred stock for $2,075 (see Note 11). We also received approximately $850 in upfront cash proceeds from a structured sale-leaseback of real estate.
Current report
DISCUSSION AND RECONCILIATION OF NON-GAAP MEASURES
Current report
We also evaluate segment and business unit performance based on EBITDA, which is defined as operating income excluding depreciation and amortization, and/or EBITDA margin, which is defined as EBITDA divided by total revenue. EBITDA is used as part of our management reporting, and we believe EBITDA to be a relevant and useful measurement to our investors as it measures the cash generation potential of our business units. EBITDA does not give effect to depreciation and amortization expenses incurred in operating income nor is it burdened by cash used for debt service requirements and thus does not reflect available funds for distributions, reinvestment or other discretionary uses. There are material limitations to using these non-GAAP financial measures. EBITDA and EBITDA margin, as we have defined them, may not be comparable to similarly titled measures reported by other companies.
Removed paragraphs (17)
Previous report
Operations and support expenses increased in the third quarter and for the first nine months of 2024, primarily due to a $4,422 noncash goodwill impairment. We performed an interim goodwill impairment test of the Business Wireline reporting unit and concluded that the calculated fair value was lower than the book value, which was driven by a faster-than-previously anticipated industry-wide secular decline of legacy services (see Note 1). The increases were partially offset by lower Mobility equipment costs resulting from lower wireless sales volumes and expense declines from our continued transformation efforts.
Previous report
Equity in net income of affiliates decreased in the third quarter and for the first nine months of 2024, primarily due to the performance of our investment in DIRECTV, which included our share of a gain on a sale-leaseback transaction by DIRECTV of approximately $100 in the first quarter of 2023 (see Note 9).
Previous report
The decrease for the first nine months was primarily driven by lower pension and postretirement benefit credits in 2024 and net actuarial and settlement gains in 2023 with no corresponding remeasurement in 2024 (see Note 6) and an impairment recognized on a held-for-sale business, partially offset by the prior-year write-down of our SKY Mexico equity investment and higher returns on other benefit-related investments.
Previous report
Our effective tax rate was 89.9% in the third quarter of 2024 and 31.1% for the first nine months of 2024, versus 23.2% and 22.9% in the comparable periods in the prior year. The increase in our effective tax rates were primarily due to the goodwill impairment, which is not deductible for tax purposes.
Previous report
Depreciation expense increased in the third quarter and for the first nine months of 2024, primarily due to shortening of estimated economic lives of wireless equipment that will be replaced earlier than originally anticipated with our Open RAN deployment and network transformation, and ongoing capital spending for network upgrades and expansion, which we expect to continue through the remainder of 2024.
Previous report
Operating income increased in the third quarter and for the first nine months of 2024. Our Mobility operating income margin in the third quarter increased from 32.7% in 2023 to 33.3% in 2024 and for the first nine months increased from 31.9% in 2023 to 32.5% in 2024. Our Mobility EBITDA margin in the third quarter increased from 43.0% in 2023 to 45.1% in 2024 and for the first nine months increased from 42.2% in 2023 to 44.5% in 2024. EBITDA is defined as operating income excluding depreciation and amortization.
Previous report
Equipment revenues increased in the third quarter and for the first nine months of 2024, driven by higher customer premises equipment sales, which are nonrecurring in nature.
Previous report
Equipment revenues increased in the third quarter and for the first nine months of 2024. The increase in the third quarter was primarily driven by higher equipment sales, partially offset by unfavorable foreign exchange impacts. The increase for the first nine months was primarily driven by higher equipment sales and favorable exchange rates primarily from the first quarter of 2024.
Previous report
In the Telecommunications Act of 1996 (Telecom Act), Congress established a national policy framework intended to bring the benefits of competition and investment in advanced telecommunications facilities and services to all Americans by opening all telecommunications markets to competition and reducing or eliminating regulatory burdens that harm consumer welfare. Nonetheless, since then, the FCC and some state regulatory commissions have maintained, re-imposed or expanded certain regulatory requirements that were imposed decades ago on our traditional wireline subsidiaries when they operated as legal monopolies. Recently, the FCC’s regulatory approach has depended on control of the executive branch, eliminating a variety of antiquated and unnecessary regulations in a number of areas, while imposing or re-imposing regulations in other areas. We continue to support regulatory and legislative measures and efforts, at both the state and federal levels, to reduce inappropriate regulatory burdens that inhibit our ability to compete effectively and offer needed services to our customers, including initiatives to transition services from traditional networks to all IP-based networks. At the same time, we also seek to ensure that legacy regulations are not further extended to broadband or wireless services, which are subject to vigorous competition.
Previous report
Until 2015, the FCC classified fixed and mobile consumer broadband internet access services as information services subject to minimal regulation. In 2015, the FCC reclassified such services as telecommunications services subject to broader regulation by the FCC and imposed “net neutrality rules.” Since then, the FCC has twice reversed course, most recently again reclassifying such services as telecommunications services subject to broader regulation by the FCC in an order adopted on April 25, 2024. Multiple trade associations and other parties have challenged the FCC’s reclassification decision in appeals consolidated in the U.S. Court of Appeals for the Sixth Circuit. The trade associations have petitioned the Sixth Circuit to stay the FCC’s order. On August 1, 2024, the Sixth Circuit issued a stay of the FCC order pending review of the appeals, holding that broadband providers are likely to succeed on the merits. The appeals are now being briefed, with oral argument scheduled for October 31, 2024.
Previous report
Since 2018, some states have adopted legislation or issued executive orders that established state net neutrality rules, including California and Vermont. We expect additional states may seek to impose net neutrality and other requirements on broadband in the future.
Previous report
On November 15, 2021, the Infrastructure Investment and Jobs Act (IIJA) was signed into law. The legislation appropriates $65,000 to support broadband deployment and adoption. The National Telecommunications and Information Agency (NTIA) is responsible for distributing more than $48,000 of this funding, including $42,500 in state grants for broadband deployment projects in unserved and underserved areas through the Broadband, Equity, Access, and Deployment (BEAD) Programs. NTIA and states are in the process of administering these grants. Where appropriate, AT&T has applied for, and in some cases has been awarded, and may continue to apply for grants under this or other government infrastructure programs. The IIJA also appropriated $14,200 for establishment of the Affordable Connectivity Program (ACP), an FCC-administered monthly, low-income broadband benefit program, in which AT&T participated. The ACP ended earlier this year.
Previous report
On November 15, 2023, the FCC adopted rules to “facilitate” equal access to broadband and prevent digital discrimination in broadband access. The rules, which became effective March 22, 2024, prohibit covered entities from implementing policies or practices not justified by genuine issues of technical or economic feasibility, that differentially impact consumers’ access to broadband internet access service based on prohibited characteristics (including income level, race, and ethnicity) or that have such differential impact, whether intentional or not. The rules broadly apply prospectively to all aspects of an ISP’s service that could impact a consumer’s ability to access broadband, including deployment, marketing, and credit checks, among other things. We may be required to answer complaints alleging that the company has violated the FCC rules and those complaints may seek relief, including changes to our business practices or civil forfeitures that could result in significant costs or reputational harm. It is currently uncertain how the FCC will implement and enforce these new rules. Several business and consumer-oriented associations have filed appeals challenging the rules and those appeals have been consolidated in the Eighth Circuit, which held oral argument on September 25, 2024.
Previous report
Privacy-related legislation continues to be adopted or considered in a number of jurisdictions. Legislative, regulatory and litigation actions could result in increased costs of compliance, further regulation or claims against broadband internet access service providers and others, and increased uncertainty in the value and availability of data.
Previous report
During 2020-2021, we deployed 5G nationwide on “low band” spectrum on macro towers. Executing on recent spectrum purchases, we announced ongoing construction and continuing deployment of 5G on 3.45 GHz and C-band spectrum in 2022 and beyond. Additional spectrum will be needed industrywide for 5G and future services. In 2023, the federal government released a national spectrum strategy that focused on spectrum sharing but did not include specific timelines to make additional spectrum bands available for 5G and future generations of service. As a result, the federal government’s ability and intent to make sufficient spectrum available to the industry in needed timeframes remains uncertain.
Previous report
During the first nine months of 2024, cash provided by operating activities was $26,875, compared to $26,936 for the first nine months of 2023, reflecting the timing of working capital associated with device payments, as well as the expansion of committed, cost-efficient receivable sales programs in 2024, offset by operational growth.
Previous report
For the first nine months of 2024, cash used in investing activities totaled $12,127 and consisted primarily of $13,420 (including interest during construction) for capital expenditures. During the first nine months of 2024, we also paid $457 in cash on FirstNet sustainability payment. During the first nine months of 2024, we received a return of investment of $928 from DIRECTV representing distributions in excess of cumulative equity in earnings from DIRECTV (see Note 9).
Reworded paragraphs (45)
Previous wording
•Business Wireline provides advanced ethernet-based fiber services, IP Voice and managed professional services, as well as traditional voice and data services and related equipment to business customers. In the first quarter of 2024, we began offering our fixed wireless access product that provides internet services delivered over our 5G wireless network where available.
Current wording
•Business Wireline provides advanced ethernet-based fiber services, fixed wireless services, IP Voice and managed professional services, as well as legacy voice and data services and related equipment, to business customers.
Previous wording
•Consumer Wireline provides broadband services, including fiber connections that provide multi-gig services to residential customers in select locations and our fixed wireless access product that provides home internet services delivered over our 5G wireless network where available. Consumer Wireline also provides legacy telephony voice communication services.
Current wording
•Consumer Wireline provides broadband services, including fiber connections that provide multi-gig services, and AT&T Internet Air (AIA) services, to residential customers in select locations. Consumer Wireline also provides legacy telephony voice communication services.
Previous wording
Operating revenues decreased in the third quarter and for the first nine months of 2024, reflecting declines in Business Wireline service and Mobility equipment revenues, partially offset by Mobility service, Consumer Wireline and Mexico revenues.
Current wording
Operating revenues increased in the first quarter of 2025, reflecting higher Mobility and Consumer Wireline revenues, partially offset by declines in Business Wireline and Mexico, which included unfavorable foreign exchange impacts.
Previous wording
Depreciation and amortization expense increased in the third quarter and for the first nine months of 2024, primarily due to the shortening of estimated economic lives of wireless network equipment that will be replaced earlier than originally anticipated with our Open RAN network modernization efforts. Also contributing to higher depreciation expense was the impact of ongoing capital spending for strategic initiatives such as fiber and network upgrades.
Current wording
Depreciation and amortization expense increased in the first quarter of 2025, primarily due to ongoing capital spending for strategic initiatives such as fiber and network upgrades, partially offset by lower depreciation impacts from our Open RAN network modernization efforts.
Previous wording
Operating income decreased in the third quarter and for the first nine months of 2024. Our operating income margin in the third quarter decreased from 19.1% in 2023 to 7.0% in 2024 and for the first nine months decreased from 20.1% in 2023 to 15.2% in 2024.
Current wording
Operating income decreased in the first quarter of 2025. Our operating income margin in the first quarter decreased from 19.5% in 2024 to 18.8% in 2025.
Previous wording
Interest expense increased in the third quarter and for the first nine months of 2024, primarily due to lower capitalized interest associated with spectrum acquisitions, mostly offset by lower debt balances. Interest expense for the first nine months of 2023 also included distributions on Mobility preferred interests, which were repurchased on April 5, 2023.
Current wording
Interest expense decreased in the first quarter of 2025, primarily due to lower debt balances, partially offset by lower capitalized interest associated with spectrum acquisitions.
Previous wording
Other income (expense) – net increased in the third quarter and decreased for the first nine months of 2024. The increase in the third quarter was primarily the result of a prior-year write-down of our SKY Mexico equity investment and higher returns on other benefit-related investments. These increases were partially offset by lower pension and postretirement benefit credits and an actuarial gain on our pension plan in 2023 with no corresponding remeasurement in 2024.
Current wording
Other income (expense) – net increased in the first quarter of 2025. The increase was primarily due to first-quarter 2024 noncash impairment charges for a held-for-sale business and our SKY Mexico equity investment. Partially offsetting the increase were lower pension and postretirement benefit credits and lower returns on other benefit-related investments.
Previous wording
Income tax expense increased in the third quarter and decreased for the first nine months of 2024. The increase in the third quarter was primarily due to a higher effective tax rate driven by a goodwill impairment (see Note 1), which is not deductible for tax purposes. The decrease for the first nine months was primarily due to lower income before income tax.
Current wording
Income tax expense increased in the first quarter of 2025. The increase was primarily due to higher income before income
Previous wording
Operating revenues decreased in the third quarter and for the first nine months of 2024, primarily driven by declines in our Business Wireline business unit, which reflects lower demand for legacy services and product simplification, as well as the absence of revenues from our cybersecurity business that was contributed to a new cybersecurity joint venture, LevelBlue, in the second quarter of 2024. Revenue declines were also driven by lower Mobility equipment revenue. These decreases were partially offset by increases in our Mobility and Consumer Wireline business units, driven by gains in wireless and broadband services.
Current wording
Operating revenues increased in the first quarter of 2025, primarily driven by increases in our Mobility and Consumer Wireline business units, partially offset by declines in our Business Wireline business unit, which reflects lower demand for legacy services and product simplification, as well as the absence of revenues from our cybersecurity business that was contributed to a new cybersecurity joint venture, LevelBlue, in the second quarter of 2024.
Previous wording
Operating income decreased in the third quarter and for the first nine months of 2024. Our Communications segment operating income margin in the third quarter decreased from 24.9% in 2023 to 24.6% in 2024 and for the first nine months decreased from 24.3% in 2023 to 24.2% in 2024.
Current wording
Operating income increased in the first quarter of 2025. Our Communications segment operating income margin in the first quarter increased from 23.4% in 2024 to 23.7% in 2025. Our Communications EBITDA margin in the first quarter increased from 39.8% in 2024 to 40.5% in 2025.
Previous wording
Service revenue increased in the third quarter and for the first nine months of 2024. The increases are largely due to growth from subscriber gains and postpaid phone average revenue per subscriber (ARPU) growth. As part of our transformation activities and our focus on simplification, we aligned the timing of certain administrative fees and recorded approximately $90 of one-time revenues in the third quarter of 2024.
Current wording
Service revenue increased in the first quarter of 2025. The increase is largely due to growth from postpaid phone average revenue per subscriber (ARPU) growth and subscriber gains.
Previous wording
ARPU increased in the third quarter and for the first nine months of 2024, reflecting pricing actions.
Current wording
ARPU increased in the first quarter of 2025, reflecting pricing actions and customers migrating to higher priced plans.
Previous wording
The effective management of subscriber churn is critical to our ability to maximize revenue growth and to maintain and improve margins. Postpaid churn and postpaid phone-only churn were lower in the third quarter and for the first nine months of 2024.
Current wording
The effective management of subscriber churn is critical to our ability to maximize revenue growth and to maintain and improve margins. Postpaid churn and postpaid phone-only churn were higher in the first quarter of 2025, driven by a normalization of customers reaching the end of their equipment promotional plans and a shift in competitive offers.
Previous wording
Equipment revenue decreased in the third quarter and for the first nine months of 2024, primarily driven by lower wireless device sales volumes.
Current wording
Equipment revenue increased in the first quarter of 2025, primarily driven by higher wireless device sales volumes.
Previous wording
Operations and support expenses decreased in the third quarter and for the first nine months of 2024, primarily due to lower equipment costs driven by lower wireless sales volumes.
Current wording
Operations and support expenses increased in the first quarter of 2025, primarily due to higher equipment costs driven by higher wireless sales volumes. The increase also reflected higher advertising due to launch of new campaign, promotion costs and network costs.
Previous wording
Service revenues decreased in the third quarter and for the first nine months of 2024, driven by lower demand for legacy voice, data and network services along with product simplification, partially offset by growth in connectivity services. We expect these trends to continue. Revenue declines also were impacted by prior-year intellectual property sales of approximately $100 and the absence of revenues from our cybersecurity business that was contributed to LevelBlue.
Current wording
Legacy and other transitional services revenues decreased in the first quarter of 2025, driven by lower demand for legacy and VPN services, which we expect to continue. Revenue declines also reflect the absence of revenues from our cybersecurity business that was contributed to LevelBlue in the second quarter of 2024. These revenue declines were partially offset by targeted pricing actions.
Previous wording
Operations and support expenses decreased in the third quarter and for the first nine months of 2024, primarily driven by lower personnel costs associated with ongoing transformation initiatives, lower network access and customer support expenses and the contribution of our cybersecurity business. Partially offsetting the decreases for the first nine months were higher vendor credits in 2023 and higher equipment costs in 2024. As part of our transformation activities, we expect operations and support expense improvements through the remainder of 2024 as we further right size our operations in alignment with the strategic direction of the business.
Current wording
Operations and support expenses decreased in the first quarter of 2025, primarily driven by lower personnel costs associated with ongoing transformation initiatives, lower network-related costs that included higher vendor settlements in 2025 and the contribution of our cybersecurity business. As part of our transformation activities, we expect operations and support expense improvements through the remainder of 2025 as we further right size our operations in alignment with the strategic direction of the business.
Previous wording
Depreciation expense increased in the third quarter and for the first nine months of 2024, primarily due to ongoing capital investment for strategic initiatives such as fiber, which we expect to continue through the remainder of 2024.
Current wording
Depreciation expense increased in the first quarter of 2025, primarily due to ongoing capital investment for strategic initiatives such as fiber, which we expect to continue through the remainder of 2025.
Previous wording
Operating income decreased in the third quarter and for the first nine months of 2024. Our Business Wireline operating income margin in the third quarter decreased from 6.7% in 2023 to (0.9)% in 2024 and for the first nine months decreased from 7.1% in 2023 to 0.9% in 2024. Our Business Wireline EBITDA margin in the third quarter decreased from 32.5% in 2023 to 29.4% in 2024 and for the first nine months decreased from 32.4% in 2023 to 29.9% in 2024.
Current wording
Operating income decreased in the first quarter of 2025. Our Business Wireline operating income margin in the first quarter decreased from 1.3% in 2024 to (2.2)% in 2025. Our Business Wireline EBITDA margin in the first quarter increased from 29.0% in 2024 to 31.3% in 2025.
Previous wording
Broadband revenues increased in the third quarter and for the first nine months of 2024, driven by an increase in fiber customers, which we expect to continue as we invest further in building our fiber footprint and higher ARPU, partially offset by declines in copper-based broadband services.
Current wording
Broadband revenues increased in the first quarter of 2025, driven by a 19.0% increase in fiber revenues. Higher fiber revenues reflect an increase in fiber customers, which we expect to continue as we invest further in building our fiber footprint, and higher ARPU. This increase was partially offset by declines in copper-based broadband services.
Previous wording
Legacy voice and data service revenues decreased in the third quarter and for the first nine months of 2024, reflecting the continued decline in demand for these services in favor of other technologies, such as wireless and fiber services.
Current wording
Legacy voice and data services revenues decreased in the first quarter of 2025, reflecting the continued decline in demand for these services in favor of other technologies, such as wireless and fiber services.
Previous wording
Other service and equipment revenues decreased in the third quarter and for the first nine months of 2024, reflecting the continued decline in the number of VoIP customers.
Current wording
Other service and equipment revenues decreased in the first quarter of 2025, reflecting the continued decline in the number of VoIP customers.
Previous wording
Operations and support expenses decreased in the third quarter and for the first nine months of 2024. The expense decrease in the third quarter was primarily driven by lower customer support costs and network-related costs, partially offset by higher marketing expense. The expense decrease for the first nine months was driven by lower customer support costs and operating taxes that were offset by higher network-related costs as our fiber build scales.
Current wording
Operations and support expenses decreased in the first quarter of 2025. The expense decrease in the first quarter was primarily driven by lower customer support costs and network-related costs that included higher vendor settlements in 2025.
Previous wording
Depreciation expense increased in the third quarter and for the first nine months of 2024, primarily due to ongoing capital spending for strategic initiatives such as fiber and network upgrades and expansion, which we expect to continue through the remainder of 2024.
Current wording
Depreciation expense increased in the first quarter of 2025, primarily due to ongoing capital spending for strategic initiatives such as fiber and network upgrades and expansion, which we expect to continue through the remainder of 2025.
Previous wording
Operating income increased in the third quarter and for the first nine months of 2024. Our Consumer Wireline operating income margin in the third quarter increased from 4.8% in 2023 to 5.7% in 2024 and for the first nine months increased from 4.3% in 2023 to 5.9% in 2024. Our Consumer Wireline EBITDA margin in the third quarter increased from 31.0% in 2023 to 32.8% in 2024 and for the first nine months increased from 30.7% in 2023 to 32.7% in 2024.
Current wording
Operating income increased in the first quarter of 2025. Our Consumer Wireline operating income margin in the first quarter increased from 6.4% in 2024 to 9.9% in 2025. Our Consumer Wireline EBITDA margin in the first quarter increased from 32.7% in 2024 to 36.9% in 2025.
Previous wording
Service revenues decreased in the third quarter and increased for the first nine months of 2024. The decrease in the third quarter was primarily due to unfavorable foreign exchange impacts, partially offset by growth in subscribers and ARPU. The increase for the first nine months reflects growth in subscribers and favorable exchange rates primarily from the first quarter of 2024.
Current wording
Service revenues decreased in the first quarter of 2025, reflecting unfavorable foreign exchange impacts, partially offset by growth in subscribers and ARPU.
Previous wording
Operations and support expenses increased in the third quarter and for the first nine months of 2024, primarily due to increased equipment and selling costs resulting from higher sales. Foreign exchange impacts were favorable in the third quarter and unfavorable for the first nine months. Approximately 4% of Mexico expenses are U.S. dollar based, with the remainder in the local currency.
Current wording
Operations and support expenses decreased in the first quarter of 2025, primarily due to favorable foreign exchange impacts, partially offset by increased equipment and selling costs resulting from higher sales.
Previous wording
Depreciation and amortization expense decreased in the third quarter and for the first nine months of 2024, primarily driven by lower in-service assets. Foreign exchange impacts were favorable in the third quarter and unfavorable for the first nine months.
Current wording
Depreciation and amortization expense decreased in the first quarter of 2025, primarily due to favorable foreign exchange impacts.
Previous wording
Operating income improved in the third quarter and for the first nine months of 2024. Our Mexico operating income margin in the third quarter increased from (2.9)% in 2023 to 1.0% in 2024 and for the first nine months increased from (3.4)% in 2023 to 0.6% in 2024. Our Mexico EBITDA margin in the third quarter increased from 15.6% in 2023 to 16.4% in 2024 and for the first nine months increased from 15.7% in 2023 to 16.5% in 2024.
Current wording
Operating income improved in the first quarter of 2025. Our Mexico operating income margin in the first quarter increased from 0.3% in 2024 to 4.4% in 2025. Our Mexico EBITDA margin in the first quarter increased from 16.9% in 2024 to 19.9% in 2025.
Previous wording
Overview AT&T subsidiaries operating within the United States are subject to federal and state regulatory authorities. AT&T subsidiaries operating outside the United States are subject to the jurisdiction of national and supranational regulatory authorities in the markets where service is provided.
Current wording
Overview AT&T subsidiaries operating within the United States are subject to federal and state regulations. AT&T subsidiaries operating outside the United States are subject to the jurisdiction of national and supranational regulations in the markets where service is provided. Complying with these regulations may affect our results of operations and cash flow, and compliance may be very costly. For a discussion of these regulations, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operation—Regulatory Landscape” in our Annual Report on Form 10-K for the year-ended December 31, 2024.
Previous wording
We had $2,586 in cash and cash equivalents available at September 30, 2024, decreasing $4,136 since December 31, 2023. Cash and cash equivalents included cash of $1,062 and money market funds and other cash equivalents of $1,524. Approximately $965 of our cash and cash equivalents were held in accounts outside of the U.S. and may be subject to restrictions on repatriation.
Current wording
We had $6,885 in cash and cash equivalents available at March 31, 2025, increasing $3,587 since December 31, 2024. Cash and cash equivalents included cash of $1,122 and money market funds and other cash equivalents of $5,763. Approximately $1,159 of our cash and cash equivalents were held in accounts outside of the U.S. and may be subject to restrictions on repatriation.
Previous wording
For the first nine months of 2024, cash inflows were primarily provided by cash receipts from operations, including cash from our sale and transfer of our receivables to third parties and distributions from DIRECTV. These inflows were exceeded by cash used to meet the needs of the business, including, but not limited to, payment of operating expenses. The cash generated from operating activities was used to repay short-term borrowings and long-term debt, funding capital expenditures and vendor financing payments, and dividend payments to stockholders. We maintain availability under our credit facilities and our commercial paper program to meet our short-term liquidity requirements.
Current wording
For the first three months of 2025, cash inflows were primarily provided by cash receipts from operations, including cash from our sale and transfer of our receivables to third parties, and distributions from DIRECTV. These inflows exceeded cash used to meet the needs of the business, including, but not limited to, payment of operating expenses, including higher device payments from higher sales volumes. The cash generated from operating activities was primarily used to repay long-term debt, make dividend payments to stockholders and to fund capital improvements. We maintain availability under our credit facilities and our commercial paper program to meet our short-term liquidity requirements.
Previous wording
We actively manage the timing of our supplier payments for operating items to optimize the use of our cash. Among other things, we seek to make payments on 90-day or greater terms, while providing the suppliers with access to bank facilities that permit earlier payments at their cost (referred to as supplier financing program). In addition, for payments to suppliers of handset inventory, as part of our working capital initiatives, we have arrangements that allow us to extend the stated payment terms by up to 90 days at an additional cost to us (referred to as direct supplier financing). The net impact of direct supplier financing, including principal and interest payments, was to decrease cash from operating activities approximately $3,648 and $3,054 for the nine months ended September 30, 2024 and 2023, respectively. All supplier financing payments are due within one year. (See Note 10)
Current wording
We actively manage the timing of our supplier payments for operating items to optimize the use of our cash. Among other things, we seek to make payments on 90-day or greater terms, while providing the suppliers with access to bank facilities that permit earlier payments at their cost (referred to as supplier financing program). In addition, for payments to suppliers of handset inventory, as part of our working capital initiatives, we have arrangements that allow us to extend the stated payment terms by up to 90 days at an additional cost to us (referred to as direct supplier financing). The net impact of direct supplier financing, including principal and interest payments, was to decrease cash from operating activities approximately $2,042 and $1,584 for the three months ended March 31, 2025 and 2024, respectively. All supplier financing payments are due within one year. (See Note 10)
Previous wording
For capital improvements, we have negotiated favorable vendor payment terms of 120 days or more (referred to as vendor financing) with some of our vendors, which are excluded from capital expenditures and reported as financing activities. For the first nine months of 2024, vendor financing payments were $1,571, compared to $4,736 for the first nine months of 2023. Capital expenditures for the first nine months of 2024 were $13,420, and when including $1,571 cash paid for vendor financing, capital investment was $14,991 ($2,997 lower than the prior-year comparable period).
Current wording
We enter into multi-year software licensing arrangements, which are typically paid over the license terms of two to five years and referred to as vendor financing. Additionally, for capital improvements, we have negotiated favorable vendor payment terms of 120 days or more with some of our vendors, which are also referred to as vendor financing. Vendor financing is excluded from capital expenditures and reported as financing activities. For the first three months of 2025, vendor financing payments were $203, compared to $841 for the first three months of 2024. Capital expenditures for the first three months of 2025 were $4,277, and when including $203 cash paid for vendor financing, capital investment was $4,480 ($119 lower than the prior-year comparable period).
Previous wording
The vast majority of our capital expenditures are spent on our networks, including product development and related support systems. During the first nine months of 2024, we placed $581 of productive assets (primarily software) in service under vendor financing arrangements (compared to $2,128 in the prior-year comparable period). The amount of capital expenditures is influenced by demand for services and products, capacity needs and network enhancements.
Current wording
The vast majority of our capital expenditures are spent on our networks, including product development and related support systems. During the first three months of 2025, we placed $378 of productive assets (primarily software) in service under vendor financing arrangements (compared to $99 in the prior-year comparable period). The amount of capital expenditures is influenced by demand for services and products, capacity needs and network enhancements.
Previous wording
For the first nine months of 2024, cash used in financing activities totaled $18,855 and was primarily comprised of debt repayments, payments of dividends and vendor financing payments.
Current wording
For the first three months of 2025, cash used in financing activities totaled $553 and was primarily comprised of debt repayments, dividend payments, preferred stock repurchase and vendor financing payments, offset by issuances of long-term debt and preferred interests.
Previous wording
A tabular summary of our debt activities for the nine months ended September 30, 2024 is as follows:
Current wording
A tabular summary of our debt activities for the three months ended March 31, 2025 is as follows:
Previous wording
The weighted average interest rate of our long-term debt portfolio, including credit agreement borrowings and the impact of derivatives, was approximately 4.2% as of September 30, 2024 and as of December 31, 2023. We had $127,501 of total notes and debentures outstanding at September 30, 2024. This also included Euro, British pound sterling, Canadian dollar, Swiss franc, and Australian dollar denominated debt that totaled approximately $33,477.
Current wording
The weighted average interest rate of our long-term debt portfolio, including credit agreement borrowings and the impact of derivatives, was approximately 4.2% as of March 31, 2025 and as of December 31, 2024. We had $124,790 of total notes and debentures outstanding at March 31, 2025. This also included Euro, British pound sterling, Canadian dollar, Swiss franc and Australian dollar denominated debt that totaled approximately $33,474.
Previous wording
At September 30, 2024, we had $2,637 of long-term debt maturing within one year. We had no outstanding commercial paper or other short-term borrowings on September 30, 2024. The weighted average interest rate on our outstanding short-term borrowings was approximately 6.0% as of December 31, 2023.
Current wording
At March 31, 2025, we had $8,902 of long-term debt maturing within one year. We had no outstanding commercial paper or other short-term borrowings on March 31, 2025.
Previous wording
For the first nine months of 2024, we paid $1,571 of cash under our vendor financing program, compared to $4,736 in the prior-year comparable period. Total vendor financing payables included in our September 30, 2024 consolidated balance sheet were $1,660, with $843 due within one year (in “Accounts payable and accrued liabilities”) and the remainder predominantly due within five years (in “Other noncurrent liabilities”).
Current wording
For the first three months of 2025, we paid $203 of cash under our vendor financing program, compared to $841 in the prior-year comparable period. Total vendor financing payables included in our March 31, 2025 consolidated balance sheet were $1,694, with $1,078 due within one year (in “Accounts payable and accrued liabilities”) and the remainder predominantly due within five years (in “Other noncurrent liabilities”).
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