AT&T targeting $40bn in shareholder returns as fibre network grows

AT&T has announced plans to distribute $40bn to shareholders over the next three years as it pursues targets to expand America's largest fibre network to 50m total locations by 2029.

As part of its 2024 analyst and investor day presentation later on Tuesday, the US telecoms giant unveiled a multi-year strategic plan focused on continued 5G and fibre subscriber growth.

By 2027, AT&T said it expects to have largely completed the modernisation of its 5G wireless network, supporting super-fast download speeds.

By 2029, the company expects to reach 45m locations through its organic fibre deployment as well as 5m fibre locations through Gigapower – AT&T's joint venture with Blackrock – as well as through agreements with commercial open-access providers.

"As we grow, we expect to return more than $40bn to shareholders over the next three years through dividends and share repurchases. With this bold strategy, we are entering a new era of sustained growth at AT&T," said chief executive John Stankey.

In terms of financial targets, the company is targeting adjusted EBITDA growth "in the 3% range" this year, along with free cash flow of $15bn when excluding its investment in DIRECTV which it expects to exit next year.

AT&T guided to adjusted EBITDA growth of 3% or more each year from 2025 to 2027, and expects to generate free cash flow of at least $16bn in 2025 when excluding DIRECTV.

The stock was up 4.1% at $23.63 by 1128 ET.