AT&T says its revenue tanked 5.0% in the fiscal third quarter.

AT&T Inc. (NYSE: T) said on Thursday that its revenue in the fiscal third quarter contracted less than expected. Adjusted profit, it added, came in line with what analysts had anticipated for Q3. AT&T is offering iPhone 12 for free when paired with unlimited 5G plan.

AT&T was reported about 4% up in premarket trading on Thursday and jumped another 2% on market open. On a year to date basis, shares of the company are now 25% down in the stock market.

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AT&T Q3 financial results versus analysts’ estimates

AT&T said that its net income in the third quarter printed at £2.11 billion that translates to 29.79 pence per share. In the comparable quarter of last year, it had reported a higher £2.83 billion of net income or 38.20 pence per share.

Adjusted for one-time items, the American multinational conglomerate earned 58.06 pence per share in Q3 that was in line with the FactSet Consensus. For net earnings, on the other hand, analysts had expected a higher 38.96 pence per share for the third quarter.

In terms of total revenue in the recent quarter, AT&T posted £32.35 billion that represents a 5.0% annualised decline. According to FactSet, experts had forecast an even lower £31.79 billion of revenue in the third quarter.

The Dallas-based company added 1.1 million net postpaid subscribers and 245 thousand net prepaid subscribers in the recent quarter. In the prior quarter (Q2), AT&T had lost 151 thousand postpaid phone subscribers.

Phone net adds, as per AT&T, were 645 thousand in Q3. The U.S. telecommunications company said total postpaid churn in the fiscal third quarter was 0.85%. Postpaid phone-only churn came at an even lower 0.69%.

AT&T forecasts a hit to revenue in the fiscal fourth quarter

Communications revenue saw a 3.1% year over year decline in Q3 to £26.20 billion. Revenue from WarnerMedia printed at £5.73 billion that marks a 10.0% annualised decline. FactSet Consensus for revenue from these two segments stood at £25.67 billion and £5.58 billion, respectively.

AT&T warned on Thursday that its revenue in the fiscal fourth quarter was likely to take a hit due to the Coronavirus pandemic, as it delays theatrical releases, pushes movie theatres into temporarily shutting down, and weigh on revenue from international roaming wireless services.

At the time of writing, AT&T is valued at £152.57 billion and has a price to earnings ratio of 17.12.