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AT&T Reiterates 2021 Wireless Service Revenue Growth View

John Stephens, senior executive vice president and chief financial officer of AT&T Inc. (T), reiterated that the company continues to expect wireless service revenue growth in the 2% range in 2021 as the company continues to add customers and connected devices on its network, subscribers continue to migrate to higher ARPU unlimited plans, and churn improves. He also expects modest wireless EBITDA growth in 2021.

At the Deutsche Bank Media, Internet & Telecom Conference, Stephens said AT&T currently markets its 100% fiber network to more than 14 million customer locations, which it is actively selling into, with penetration rates increasing the longer the company has fiber in a market. The company plans to increase its fiber footprint by 3 million customer locations in 2021.

Stephens said that the company's U.S. video business will be classified as "held for sale" beginning with first quarter 2021 results. AT&T will cease depreciating and amortizing long-lived assets associated with this business unit and expects a reduction of about $300 million in depreciation and amortization expense each quarter until the transaction closes.

Stephens noted that under the terms of the deal, at closing AT&T will receive $7.6 billion in cash which it intends to use to reduce debt. The new DIRECTV entity will also assume $200 million of existing DIRECTV debt from AT&T.

Stephens noted that AT&T has seen positive results from the hybrid distribution model for its 2021 film slate.

Stephens said that HBO Max and HBO added more subscribers in 2020 than HBO added in the previous 10 years. The company expects to begin international expansion of HBO Max in late June, giving the company additional opportunities to expand its customer base.

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