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AT&T Continues To See Postpaid Phone ARPU Stabilizing In 2022

Jeff McElfresh, chief executive officer of AT&T Communications, discussed momentum in AT&T's wireless business, noting that AT&T's consistent go-to-market strategy has driven improved market position supported by healthy wireless service revenue and EBITDA growth.

McElfresh spoke at the Wells Fargo Technology Media and Telecom Summit, where he provided an update on AT&T (T).

McElfresh said he is encouraged by underlying mobile industry trends and sees limited signs that suggest a near-term shift in demand levels. He believes AT&T's momentum is sustainable with the company's simplified plans, targeted subsegment approach, improved customer experience and network performance all helping AT&T retain and attract subscribers, leading to lower churn and increased customer lifetime value.

McElfresh noted that AT&T continues to see postpaid phone ARPU stabilizing in 2022 with an improvement in international roaming and subscribers adopting higher-ARPU plans balancing the impact of amortization accounting for device promotions.

McElfresh said that fewer than a quarter of gross adds and upgrades in the third quarter traded in newer devices for premium promotional offers. Only about 20% of AT&T's postpaid smartphones are on Unlimited Elite - the company's highest-ARPU and fastest-growing rate plan.

With postpaid phone ARPU stabilizing in 2022, AT&T expects higher wireless service revenues from a growing postpaid subscriber base.

McElfresh also indicated that he believes AT&T can continue to profitably increase its wireless market share going forward and reiterated that the company continues to expect fourth-quarter EBITDA growth to exceed third-quarter levels.

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