Analysts raised their recommendation on AT&T to a buy following the company’s fourth-quarter results, which delivered adjusted earnings per share of $0.52, well above the consensus of $0.46. Revenue climbed 3.7% year-over-year to $33.5 billion, topping expectations by over $600 million. Despite softer trends in mobility and legacy wireline subscribers, AT&T’s operating income of $5.8 billion and adjusted EBITDA of $11.2 billion underscored the company’s ability to exceed guidance in key profitability metrics, driving the valuation upgrade.

AT&T added 421,000 net postpaid phone customers during the quarter, marking the fifth consecutive quarter of million-plus annual postpaid phone net additions. The company also reported 283,000 new fiber broadband subscribers and 221,000 5G fixed-wireless customer additions, representing over half a million advanced home internet net additions for the second straight quarter. Consumer wireline fiber revenues grew 13.6% year-over-year to $2.2 billion, illustrating robust demand for converged connectivity bundles.

Management reaffirmed its commitment to reduce leverage and enhance shareholder value by targeting free cash flow of at least $18 billion in 2026, rising to $21 billion by 2028. The company plans to deploy over $45 billion for dividends and share repurchases from 2026 through 2028, on top of the $12 billion returned in 2025. Capital expenditures are forecast in the $23 billion–$24 billion range annually, funding network expansion and the close of Lumen’s consumer fiber operations and EchoStar’s spectrum purchases, which are expected to strengthen AT&T’s advanced connectivity platform.