To The Moon

$AT&T Inc(T)$’s second-quarter results suggest its decision to combine wireless, fibre and fixed-wireless services is beginning to produce more than defensive subscriber retention.

Revenue increased 2.3% year over year to $31.6 billion. Adjusted operating income rose to $7.5 billion, adjusted EBITDA increased 5.2% to $12.3 billion and free cash flow improved to $4.7 billion from $4.4 billion. Adjusted earnings reached $0.65 per share, compared with $0.54 a year earlier. AT&T’s July 22 earnings release provides the financial and subscriber figures.

The most important development was customer growth. AT&T added:

• 432,000 postpaid phone subscribers

• 367,000 fibre customers

• 279,000 fixed-wireless customers

• More than one million customers across its broader “Advanced Connectivity” category

Postpaid phone churn remained low at 0.86%. Approximately 42.5% of households using AT&T’s advanced home-internet products also subscribed to its wireless service.

That convergence rate is central to the bullish thesis. A household buying several services is generally harder to lose than a customer with only one. Bundling also lets AT&T distribute customer-acquisition costs across multiple products and potentially improve each household’s lifetime value.

The company is accelerating its 2026 repurchases to approximately $10 billion while retaining its plan to return more than $45 billion through dividends and buybacks from 2026 through 2028. It continues to expect at least $18 billion of free cash flow in 2026, rising to at least $21 billion by 2028.

There are two important risks.

First, AT&T still carried $144 billion of total debt and $126.4 billion of net debt at quarter-end. Share repurchases only create durable value if the company can fund them without compromising network investment or its deleveraging programme.

Second, the converged network requires continuous spending. AT&T invested $6.1 billion during the quarter and expects annual capital investment of $23 billion–$24 billion through 2028. Strong subscriber growth must therefore translate into adequate returns on that infrastructure.

Satellite competition remains a longer-term uncertainty, but the current results indicate terrestrial wireless and fibre remain competitive. AT&T exceeded expectations for postpaid-phone additions despite concerns about alternative connectivity providers. Reuters’ July 22 report discusses the contribution from bundled plans.

T Weekly Chart

The stock gapped above its previous $22.26 close and opened near $23.38 on July 22 before finishing around $23.30. That is constructive price action because the stock retained most of its earnings gap. Approximately $23.40 is the first resistance area, while $22.25–$22.50 becomes important support. A complete reversal below that support would weaken the breakout.

If we look at the weekly chart, it is approaching a technically important inflection point, with price attempting to reclaim the $23.00–$23.30 resistance band following its rebound from the July low. A decisive weekly close above $23.30, followed by a successful retest that establishes the zone as support, would strengthen the bullish case for a gradual advance toward $25.00–$26.50, with $28.00–$29.80 representing the next major resistance area. Given AT&T’s historically slower price movement, premium-selling strategies may offer a more efficient risk-reward profile than outright long calls, which remain vulnerable to time decay during extended consolidations. After breakout confirmation, an investor willing to own the shares could consider selling a 30–60 DTE cash-secured put near the $22 or $22.50 strike, while a defined-risk alternative would be a bull put credit spread, such as selling the $22.50 put and buying the $20.50 or $21 put in the same expiration. Both structures benefit from time decay and can remain profitable if the stock rises modestly or trades sideways, although a sustained weekly close back below approximately $22 would weaken the setup and warrant reassessment.

The evidence leans bullish because $AT&T Inc(T)$ is producing subscriber growth, low churn, rising free cash flow and stronger earnings simultaneously. The thesis would be invalidated by deteriorating churn, slowing fibre additions, debt failing to decline or repurchases being financed at the expense of necessary network investment. This is personal opinion for education and is not financial advice.

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Disclaimer: This article is for informational and educational purposes only and does not constitute financial, investment, or trading advice. The views expressed are personal opinions based on publicly available information and are subject to change without notice. Investors should conduct their own research and consider their financial situation, risk tolerance, and investment objectives before making any investment decisions. I do not guarantee the accuracy or completeness of the information presented.