What happened?
Shares of telecommunications conglomerate AT&T (NYSE:T) fell 6.6% in the pre-market session after the company reported third quarter results, with earnings per share below expectations while sales came in ahead of estimates.
According to a company press release, AT&T reported third-quarter revenue of $32.32 billion, up 5.3% year on year, while adjusted earnings per share rose to $0.65 from $0.54 in the prior-year period. On a GAAP basis, profit of $0.12 per share fell 80.6% short of Wall Street's consensus estimate of $0.62, though revenue surpassed expectations of $31.67 billion. Diluted earnings declined because of the non-cash charge on the Mexico unit alongside employee separation costs, while the carrier added 379,000 postpaid phone net additions, 442,000 net new fiber subscribers, and 327,000 fixed-wireless customers. The substantial non-cash write-down weighed heavily on headline profitability, dampening investor sentiment despite the solid broadband and subscriber metrics.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy AT&T? Access our full analysis report here, it’s free.
What is the market telling us
AT&T’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 12 days ago when the stock dropped 6.8% on the news that SpaceX struck a definitive agreement to acquire Grain Management’s nationwide 800 MHz spectrum portfolio for an estimated $8 billion, raising competitive concerns across legacy wireless providers. Grain Management announced that the transaction covers 100% of its nationwide 800 MHz licenses, delivering up to 14 MHz of paired low-band spectrum subject to Federal Communications Commission approval. In comments on X, SpaceX Chief Executive Elon Musk termed the airwaves the last critical piece of the spectrum puzzle required to offer complete mobile coverage in America, as existing smartphones already support the 800 MHz band. In research carried by Reuters, Morgan Stanley analysts observed that the deal signals SpaceX will become an aggressive spectrum acquirer, though any threat to incumbent carriers will likely materialize gradually in rural markets rather than urban centers. Bernstein analyst Madison Rezaei added in a client note that while low-band spectrum makes an independent network cheaper, building a nationwide terrestrial footprint would still cost between $50 billion and $130 billion across tens of thousands of cell sites. AT&T relies on long-term postpaid phone contracts and bundled fiber offerings to fund heavy capital expenditures and sustain its balance-sheet deleveraging. While satellite signals combined with limited low-band spectrum cannot duplicate dense urban macro capacity, an alternative direct-to-device network threatens to erode rural coverage premiums and cap future subscriber pricing power.
AT&T is down 9.3% since the beginning of the year, and at $22.27 per share, it is trading 23.5% below its 52-week high of $29.10 from March 2026. Investors who bought $1,000 worth of AT&T’s shares 5 years ago would now be looking at only $864.36.
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