AT&T executives revealed plans to sell tower assets in the US and Mexico as part of an ongoing effort to slash its massive pile of debt.
CFO John Stevens said on an earnings call the operator cut $6.8 billion from its debt load in Q2, primarily via the sale of its stake in Hulu and a property in New York City.
It ended the quarter with $157.9 billion in debt remaining and is now looking to eliminate another $12 billion by the end of the year, in part through the sale of around 1,300 towers in the US and more than 1,000 in Mexico, as well as 250 blocks of land, he said.
He added the sale of those assets will also help pay for the operator’s recent investment in spectrum in the Federal Communications Commission’s 24GHz auction.
AT&T is working to balance debt management with network investments, as it continues construction of both its FirstNet emergency service and 5G networks.
CEO Randall Stephenson reiterated the operator aims to achieve nationwide 5G coverage by mid-2020, having initially launched a limited mobile service in December 2018.
But he noted the operator doesn’t plan to start pressing consumers to upgrade to 5G until late 2020.
“As we exit next year there will be a dozen more handsets that use this technology. Then you’ll see us ratchet up the marketing and promotion. But we don’t want to get too aggressive with the consumer right now when there aren’t too many handsets in the market place and there isn’t significant coverage.”
Meanwhile, Stevens said FirstNet is now 60 per cent complete, with construction 9 months ahead of schedule. The operator is targeting 70 per cent completion by the end of the year, he added.
He again flagged the FirstNet rollout as a boon for the operator’s wireless business, noting it is allowing AT&T to expand market share in a pool of around 14 million primary and secondary emergency services staff.
Consolidated revenue of $45 billion in Q2 was up just over 15 per cent from $39 billion in Q2 2018, while net income attributable to AT&T dipped from $5.1 billion to $3.7 billion.
Wireless revenue of $17.5 billion was up 1.3 per cent year-on-year as increased service revenue offset a drop in equipment revenue.