AT&T 10-Q 2024-09-30

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

or

☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-08610

AT&T INC.

Incorporated under the laws of the State of Delaware

I.R.S. Employer Identification Number 43-1301883

208 S. Akard St., Dallas, Texas 75202

Telephone Number: (210) 821-4105

Securities registered pursuant to Section 12(b) of the Act:

						Name of each exchange
Title of each class			Trading Symbol(s)			on which registered
Common Shares (Par Value $1.00 Per Share)			T			New York Stock Exchange
Depositary Shares, each representing a 1/1000th interest in a share of 5.000% Perpetual Preferred Stock, Series A			T PRA			New York Stock Exchange
Depositary Shares, each representing a 1/1000th interest in a share of 4.750% Perpetual Preferred Stock, Series C			T PRC			New York Stock Exchange
AT&T Inc. Floating Rate Global Notes due March 6, 2025			T 25A			New York Stock Exchange
AT&T Inc. 3.550% Global Notes due November 18, 2025			T 25B			New York Stock Exchange
AT&T Inc. 3.500% Global Notes due December 17, 2025			T 25			New York Stock Exchange
AT&T Inc. 0.250% Global Notes due March 4, 2026			T 26E			New York Stock Exchange
AT&T Inc. 1.800% Global Notes due September 5, 2026			T 26D			New York Stock Exchange
AT&T Inc. 2.900% Global Notes due December 4, 2026			T 26A			New York Stock Exchange
AT&T Inc. 1.600% Global Notes due May 19, 2028			T 28C			New York Stock Exchange
AT&T Inc. 2.350% Global Notes due September 5, 2029			T 29D			New York Stock Exchange
AT&T Inc. 4.375% Global Notes due September 14, 2029			T 29B			New York Stock Exchange
AT&T Inc. 2.600% Global Notes due December 17, 2029			T 29A			New York Stock Exchange
AT&T Inc. 0.800% Global Notes due March 4, 2030			T 30B			New York Stock Exchange
AT&T Inc. 3.950% Global Notes due April 30, 2031			T 31F			New York Stock Exchange
AT&T Inc. 2.050% Global Notes due May 19, 2032			T 32A			New York Stock Exchange

						Name of each exchange
Title of each class			Trading Symbol(s)			on which registered
AT&T Inc. 3.550% Global Notes due December 17, 2032			T 32			New York Stock Exchange
AT&T Inc. 5.200% Global Notes due November 18, 2033			T 33			New York Stock Exchange
AT&T Inc. 3.375% Global Notes due March 15, 2034			T 34			New York Stock Exchange
AT&T Inc. 4.300% Global Notes due November 18, 2034			T 34C			New York Stock Exchange
AT&T Inc. 2.450% Global Notes due March 15, 2035			T 35			New York Stock Exchange
AT&T Inc. 3.150% Global Notes due September 4, 2036			T 36A			New York Stock Exchange
AT&T Inc. 2.600% Global Notes due May 19, 2038			T 38C			New York Stock Exchange
AT&T Inc. 1.800% Global Notes due September 14, 2039			T 39B			New York Stock Exchange
AT&T Inc. 7.000% Global Notes due April 30, 2040			T 40			New York Stock Exchange
AT&T Inc. 4.250% Global Notes due June 1, 2043			T 43			New York Stock Exchange
AT&T Inc. 4.875% Global Notes due June 1, 2044			T 44			New York Stock Exchange
AT&T Inc. 4.000% Global Notes due June 1, 2049			T 49A			New York Stock Exchange
AT&T Inc. 4.250% Global Notes due March 1, 2050			T 50			New York Stock Exchange
AT&T Inc. 3.750% Global Notes due September 1, 2050			T 50A			New York Stock Exchange
AT&T Inc. 5.350% Global Notes due November 1, 2066			TBB			New York Stock Exchange
AT&T Inc. 5.625% Global Notes due August 1, 2067			TBC			New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer			☒			Accelerated Filer			☐
Non-accelerated filer			☐			Smaller reporting company			☐
						Emerging growth company			☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

At October 24, 2024, there were 7,175,289,157 common shares outstanding.

PART I - FINANCIAL INFORMATION

AT&T INC.
CONSOLIDATED STATEMENTS OF INCOME
Dollars in millions except per share amounts
(Unaudited)
			Three months ended												Nine months ended
			September 30,												September 30,
			2024						2023						2024						2023
Operating Revenues
Service			$	25,134					$	25,112					$	74,982					$	74,579
Equipment			5,079						5,238						15,056						15,827
Total operating revenues			30,213						30,350						90,038						90,406
Operating Expenses
Cost of revenues
Equipment			4,933						5,219						14,891						15,933
Other cost of revenues (exclusive of depreciation and amortization shown separately below)			6,697						6,835						20,135						20,279
Selling, general and administrative			6,958						7,205						21,022						21,389
Asset impairments and abandonments and restructuring			4,422						604						5,061						604
Depreciation and amortization			5,087						4,705						15,206						14,011
Total operating expenses			28,097						24,568						76,315						72,216
Operating Income			2,116						5,782						13,723						18,190
Other Income (Expense)
Interest expense			(1,675)						(1,662)						(5,098)						(4,978)
Equity in net income of affiliates			272						420						915						1,338
Other income (expense) — net			717						440						1,850						2,362
Total other income (expense)			(686)						(802)						(2,333)						(1,278)
Income Before Income Taxes			1,430						4,980						11,390						16,912
Income tax expense			1,285						1,154						3,545						3,871
Net Income			145						3,826						7,845						13,041
Less: Net Income Attributable to Noncontrolling Interest			(319)						(331)						(977)						(829)
Net Income (Loss) Attributable to AT&T			$	(174)					$	3,495					$	6,868					$	12,212
Less: Preferred Stock Dividends			(52)						(51)						(153)						(155)
Net Income (Loss) Attributable to Common Stock			$	(226)					$	3,444					$	6,715					$	12,057
Basic Earnings (Loss) Per Share Attributable to Common Stock			$	(0.03)					$	0.48					$	0.93					$	1.67
Diluted Earnings (Loss) Per Share Attributable to Common Stock			$	(0.03)					$	0.48					$	0.93					$	1.67
Weighted Average Number of Common Shares Outstanding — Basic (in millions)			7,202						7,185						7,197						7,178
Weighted Average Number of Common Shares Outstanding — with Dilution (in millions)			7,208						7,185						7,200						7,280

See Notes to Consolidated Financial Statements.

AT&T INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Dollars in millions
(Unaudited)
			Three months ended												Nine months ended
			September 30,												September 30,
			2024						2023						2024						2023
Net income			$	145					$	3,826					$	7,845					$	13,041
Other comprehensive income (loss), net of tax:
Foreign currency:
Translation adjustment, net of taxes of $(107), $(29), $(168) and $111			(137)						(90)						(329)						367
Reclassification adjustment included in net income, net of taxes of $0, $0, $(14) and $0			—						—						127						—
Securities:
Net unrealized gains (losses), net of taxes of $6, $(12), $5 and $(8)			30						(37)						13						(25)
Reclassification adjustment included in net income, net of taxes of $0, $1, $3 and $3			—						2						10						7
Derivative instruments:
Net unrealized gains (losses), net of taxes of $(102), $211, $(118) and $213			(315)						843						(364)						867
Reclassification adjustment included in net income, net of taxes of $4, $3, $11 and $9			11						12						33

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Dollars in millions except per share amounts

Consumer Wireline Results
						Third Quarter																		Nine-Month Period
																		Percent																		Percent
						2024						2023						Change						2024						2023						Change
Operating revenues
Broadband						$	2,838					$	2,667					6.4		%				$	8,301					$	7,755					7.0		%
Legacy voice and data services						307						368						(16.6)						972						1,147						(15.3)
Other service and equipment						271						296						(8.4)						840						919						(8.6)
Total Operating Revenues						3,416						3,331						2.6						10,113						9,821						3.0
Operating expenses
Operations and support						2,296						2,300						(0.2)						6,801						6,810						(0.1)
Depreciation and amortization						924						871						6.1						2,719						2,589						5.0
Total Operating Expenses						3,220						3,171						1.5						9,520						9,399						1.3
Operating Income						$	196					$	160					22.5		%				$	593					$	422					40.5		%

The following tables highlight other key measures of performance for Consumer Wireline:

Connections
																								September 30,												Percent
(in 000s)																								2024						2023						Change
Broadband Connections
Total Broadband and DSL Connections																								13,972						13,887						0.6		%
Broadband1																								13,864						13,710						1.1
Fiber Broadband Connections																								9,024						8,034						12.3
Voice Connections
Retail Consumer Switched Access Lines																								1,386						1,737						(20.2)
Consumer VoIP Connections																								1,716						2,035						(15.7)
Total Retail Consumer Voice Connections																								3,102						3,772						(17.8)		%
1Includes AT&T Internet Air.

Broadband Net Additions
						Third Quarter																		Nine-Month Period
																		Percent																		Percent
(in 000s)						2024						2023						Change						2024						2023						Change
Total Broadband and DSL Net Additions						10						(8)						—		%				82						(104)						—		%
Broadband Net Additions1						28						15						86.7						135						(43)						—
Fiber Broadband Net Additions						226						296						(23.6)		%				717						819						(12.5)		%
1Includes AT&T Internet Air.

Broadband revenues increased in the third quarter and for the first nine months of 2024, driven by an increase in fiber customers, which we expect to continue as we invest further in building our fiber footprint and higher ARPU, partially offset by declines in copper-based broadband services.

Legacy voice and data service revenues decreased in the third quarter and for the first nine months of 2024, reflecting the continued decline in demand for these services in favor of other technologies, such as wireless and fiber services.

AT&T INC.

SEPTEMBER 30, 2024

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations- Continued

Dollars in millions except per share amounts

Other service and equipment revenues decreased in the third quarter and for the first nine months of 2024, reflecting the continued decline in the number of VoIP customers.

Operations and support expenses decreased in the third quarter and for the first nine months of 2024. The expense decrease in the third quarter was primarily driven by lower customer support costs and network-related costs, partially offset by higher marketing expense. The expense decrease for the first nine months was driven by lower customer support costs and operating taxes that were offset by higher network-related costs as our fiber build scales.

Depreciation expense increased in the third quarter and for the first nine months of 2024, primarily due to ongoing capital spending for strategic initiatives such as fiber and network upgrades and expansion, which we expect to continue through the remainder of 2024.

Operating income increased in the third quarter and for the first nine months of 2024. Our Consumer Wireline operating income margin in the third quarter increased from 4.8% in 2023 to 5.7% in 2024 and for the first nine months increased from 4.3% in 2023 to 5.9% in 2024. Our Consumer Wireline EBITDA margin in the third quarter increased from 31.0% in 2023 to 32.8% in 2024 and for the first nine months increased from 30.7% in 2023 to 32.7% in 2024.

LATIN AMERICA SEGMENT						Third Quarter																		Nine-Month Period
						2024						2023						Percent Change						2024						2023						Percent Change
Segment Operating Revenues
Service						$	645					$	672					(4.0)		%				$	2,034					$	1,898					7.2		%
Equipment						377						320						17.8						1,154						944						22.2
Total Segment Operating Revenues						1,022						992						3.0						3,188						2,842						12.2
Segment Operating Expenses
Operations and support						854						837						2.0						2,662						2,396						11.1
Depreciation and amortization						158						184						(14.1)						507						544						(6.8)
Total Segment Operating Expenses						1,012						1,021						(0.9)						3,169						2,940						7.8
Operating Income (Loss)						$	10					$	(29)					—		%				$	19					$	(98)					—		%

The following tables highlight other key measures of performance for Mexico:

Subscribers
																								September 30,												Percent
(in 000s)																								2024						2023						Change
Mexico Wireless Subscribers
Postpaid																								5,633						5,085						10.8		%
Prepaid																								16,996						16,213						4.8
Reseller																								282						456						(38.2)
Total Mexico Wireless Subscribers																								22,911						21,754						5.3		%

AT&T INC.

SEPTEMBER 30, 2024

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations- Continued

Dollars in millions except per share amounts

Mexico Wireless Net Additions
						Third Quarter																		Nine-Month Period
																		Percent																		Percent
(in 000s)						2024						2023						Change						2024						2023						Change
Mexico Wireless Net Additions
Postpaid						139						55						—		%				397						160						—		%
Prepaid						187						17						—						333						9						—
Reseller						(51)						(7)						—						(135)						(18)						—
Total Mexico Wireless Net Additions						275						65						—		%				595						151						—		%

Service revenues decreased in the third quarter and increased for the first nine months of 2024. The decrease in the third quarter was primarily due to unfavorable foreign exchange impacts, partially offset by growth in subscribers and ARPU. The increase for the first nine months reflects growth in subscribers and favorable exchange rates primarily from the first quarter of 2024.

Equipment revenues increased in the third quarter and for the first nine months of 2024. The increase in the third quarter was primarily driven by higher equipment sales, partially offset by unfavorable foreign exchange impacts. The increase for the first nine months was primarily driven by higher equipment sales and favorable exchange rates primarily from the first quarter of 2024.

Operations and support expenses increased in the third quarter and for the first nine months of 2024, primarily due to increased equipment and selling costs resulting from higher sales. Foreign exchange impacts were favorable in the third quarter and unfavorable for the first nine months. Approximately 4% of Mexico expenses are U.S. dollar based, with the remainder in the local currency.

Depreciation and amortization expense decreased in the third quarter and for the first nine months of 2024, primarily driven by lower in-service assets. Foreign exchange impacts were favorable in the third quarter and unfavorable for the first nine months.

Operating income improved in the third quarter and for the first nine months of 2024. Our Mexico operating income margin in the third quarter increased from (2.9)% in 2023 to 1.0% in 2024 and for the first nine months increased from (3.4)% in 2023 to 0.6% in 2024. Our Mexico EBITDA margin in the third quarter increased from 15.6% in 2023 to 16.4% in 2024 and for the first nine months increased from 15.7% in 2023 to 16.5% in 2024.

COMPETITIVE AND REGULATORY ENVIRONMENT

Overview AT&T subsidiaries operating within the United States are subject to federal and state regulatory authorities. AT&T subsidiaries operating outside the United States are subject to the jurisdiction of national and supranational regulatory authorities in the markets where service is provided.

In the Telecommunications Act of 1996 (Telecom Act), Congress established a national policy framework intended to bring the benefits of competition and investment in advanced telecommunications facilities and services to all Americans by opening all telecommunications markets to competition and reducing or eliminating regulatory burdens that harm consumer welfare. Nonetheless, since then, the FCC and some state regulatory commissions have maintained, re-imposed or expanded certain regulatory requirements that were imposed decades ago on our traditional wireline subsidiaries when they operated as legal monopolies. Recently, the FCC’s regulatory approach has depended on control of the executive branch, eliminating a variety of antiquated and unnecessary regulations in a number of areas, while imposing or re-imposing regulations in other areas. We continue to support regulatory and legislative measures and efforts, at both the state and federal levels, to reduce inappropriate regulatory burdens that inhibit our ability to compete effectively and offer needed services to our customers, including initiatives to transition services from traditional networks to all IP-based networks. At the same time, we also seek to ensure that legacy regulations are not further extended to broadband or wireless services, which are subject to vigorous competition.

Until 2015, the FCC classified fixed and mobile consumer broadband internet access services as information services subject to minimal regulation. In 2015, the FCC reclassified such services as telecommunications services subject to broader regulation by

AT&T INC.

SEPTEMBER 30, 2024

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations- Continued

Dollars in millions except per share amounts

the FCC and imposed “net neutrality rules.” Since then, the FCC has twice reversed course, most recently again reclassifying such services as telecommunications services subject to broader regulation by the FCC in an order adopted on April 25, 2024. Multiple trade associations and other parties have challenged the FCC’s reclassification decision in appeals consolidated in the U.S. Court of Appeals for the Sixth Circuit. The trade associations have petitioned the Sixth Circuit to stay the FCC’s order. On August 1, 2024, the Sixth Circuit issued a stay of the FCC order pending review of the appeals, holding that broadband providers are likely to succeed on the merits. The appeals are now being briefed, with oral argument scheduled for October 31, 2024.

Since 2018, some states have adopted legislation or issued executive orders that established state net neutrality rules, including California and Vermont. We expect additional states may seek to impose net neutrality and other requirements on broadband in the future.

On November 15, 2021, the Infrastructure Investment and Jobs Act (IIJA) was signed into law. The legislation appropriates $65,000 to support broadband deployment and adoption. The National Telecommunications and Information Agency (NTIA) is responsible for distributing more than $48,000 of this funding, including $42,500 in state grants for broadband deployment projects in unserved and underserved areas through the Broadband, Equity, Access, and Deployment (BEAD) Programs. NTIA and states are in the process of administering these grants. Where appropriate, AT&T has applied for, and in some cases has been awarded, and may continue to apply for grants under this or other government infrastructure programs. The IIJA also appropriated $14,200 for establishment of the Affordable Connectivity Program (ACP), an FCC-administered monthly, low-income broadband benefit program, in which AT&T participated. The ACP ended earlier this year.

On November 15, 2023, the FCC adopted rules to “facilitate” equal access to broadband and prevent digital discrimination in broadband access. The rules, which became effective March 22, 2024, prohibit covered entities from implementing policies or practices not justified by genuine issues of technical or economic feasibility, that differentially impact consumers’ access to broadband internet access service based on prohibited characteristics (including income level, race, and ethnicity) or that have such differential impact, whether intentional or not. The rules broadly apply prospectively to all aspects of an ISP’s service that could impact a consumer’s ability to access broadband, including deployment, marketing, and credit checks, among other things. We may be required to answer complaints alleging that the company has violated the FCC rules and those complaints may seek relief, including changes to our business practices or civil forfeitures that could result in significant costs or reputational harm. It is currently uncertain how the FCC will implement and enforce these new rules. Several business and consumer-oriented associations have filed appeals challenging the rules and those appeals have been consolidated in the Eighth Circuit, which held oral argument on September 25, 2024.

Privacy-related legislation continues to be adopted or considered in a number of jurisdictions. Legislative, regulatory and litigation actions could result in increased costs of compliance, further regulation or claims against broadband internet access service providers and others, and increased uncertainty in the value and availability of data.

During 2020-2021, we deployed 5G nationwide on “low band” spectrum on macro towers. Executing on recent spectrum purchases, we announced ongoing construction and continuing deployment of 5G on 3.45 GHz and C-band spectrum in 2022 and beyond. Additional spectrum will be needed industrywide for 5G and future services. In 2023, the federal government released a national spectrum strategy that focused on spectrum sharing but did not include specific timelines to make additional spectrum bands available for 5G and future generations of service. As a result, the federal government’s ability and intent to make sufficient spectrum available to the industry in needed timeframes remains uncertain.

AT&T INC.

SEPTEMBER 30, 2024

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations- Continued

Dollars in millions except per share amounts

LIQUIDITY AND CAPITAL RESOURCES

For nine months ended September 30,			2024						2023
Cash provided by operating activities			$	26,875					$	26,936
Cash used in investing activities			(12,127)						(13,786)
Cash used in financing activities			(18,855)						(9,284)

			September 30,						December 31,
			2024						2023
Cash and cash equivalents			$	2,586					$	6,722
Total debt			129,012						137,331

We had $2,586 in cash and cash equivalents available at September 30, 2024, decreasing $4,136 since December 31, 2023. Cash and cash equivalents included cash of $1,062 and money market funds and other cash equivalents of $1,524. Approximately $965 of our cash and cash equivalents were held in accounts outside of the U.S. and may be subject to restrictions on repatriation.

For the first nine months of 2024, cash inflows were primarily provided by cash receipts from operations, including cash from our sale and transfer of our receivables to third parties and distributions from DIRECTV. These inflows were exceeded by cash used to meet the needs of the business, including, but not limited to, payment of operating expenses. The cash generated from operating activities was used to repay short-term borrowings and long-term debt, funding capital expenditures and vendor financing payments, and dividend payments to stockholders. We maintain availability under our credit facilities and our commercial paper program to meet our short-term liquidity requirements.

Cash Provided by Operating Activities

During the first nine months of 2024, cash provided by operating activities was $26,875, compared to $26,936 for the first nine months of 2023, reflecting the timing of working capital associated with device payments, as well as the expansion of committed, cost-efficient receivable sales programs in 2024, offset by operational growth.

We actively manage the timing of our supplier payments for operating items to optimize the use of our cash. Among other things, we seek to make payments on 90-day or greater terms, while providing the suppliers with access to bank facilities that permit earlier payments at their cost (referred to as supplier financing program). In addition, for payments to suppliers of handset inventory, as part of our working capital initiatives, we have arrangements that allow us to extend the stated payment terms by up to 90 days at an additional cost to us (referred to as direct supplier financing). The net impact of direct supplier financing, including principal and interest payments, was to decrease cash from operating activities approximately $3,648 and $3,054 for the nine months ended September 30, 2024 and 2023, respectively. All supplier financing payments are due within one year. (See Note 10)

Cash Used in Investing Activities

For the first nine months of 2024, cash used in investing activities totaled $12,127 and consisted primarily of $13,420 (including interest during construction) for capital expenditures. During the first nine months of 2024, we also paid $457 in cash on FirstNet sustainability payment. During the first nine months of 2024, we received a return of investment of $928 from DIRECTV representing distributions in excess of cumulative equity in earnings from DIRECTV (see Note 9).

For capital improvements, we have negotiated favorable vendor payment terms of 120 days or more (referred to as vendor financing) with some of our vendors, which are excluded from capital expenditures and reported as financing activities. For the first nine months of 2024, vendor financing payments were $1,571, compared to $4,736 for the first nine months of 2023. Capital expenditures for the first nine months of 2024 were $13,420, and when including $1,571 cash paid for vendor financing, capital investment was $14,991 ($2,997 lower than the prior-year comparable period).

The vast majority of our capital expenditures are spent on our networks, including product development and related support systems. During the first nine months of 2024, we placed $581 of productive assets (primarily software) in service under vendor

AT&T INC.

SEPTEMBER 30, 2024

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations- Continued

Dollars in millions except per share amounts

financing arrangements (compared to $2,128 in the prior-year comparable period). The amount of capital expenditures is influenced by demand for services and products, capacity needs and network enhancements.

Cash Provided by or Used in Financing Activities

For the first nine months of 2024, cash used in financing activities totaled $18,855 and was primarily comprised of debt repayments, payments of dividends and vendor financing payments.

A tabular summary of our debt activities for the nine months ended September 30, 2024 is as follows:

			First Quarter			Second Quarter			Third Quarter			Nine months ended September 30, 2024
Net commercial paper borrowings			$	428		$	262		$	(2,686)		$	(1,996)
Repayments
USD notes			$	(2,300)		$	(1,615)		$	—		$	(3,915)
EUR notes			(2,181)			(32)			—			(2,213)
CAD notes			—			(442)			—			(442)
Other			(204)			(136)			(203)			(543)
Repayments of long-term debt			$	(4,685)		$	(2,225)		$	(203)		$	(7,113)

The weighted average interest rate of our long-term debt portfolio, including credit agreement borrowings and the impact of derivatives, was approximately 4.2% as of September 30, 2024 and as of December 31, 2023. We had $127,501 of total notes and debentures outstanding at September 30, 2024. This also included Euro, British pound sterling, Canadian dollar, Swiss franc, and Australian dollar denominated debt that totaled approximately $33,477.

At September 30, 2024, we had $2,637 of long-term debt maturing within one year. We had no outstanding commercial paper or other short-term borrowings on September 30, 2024. The weighted average interest rate on our outstanding short-term borrowings was approximately 6.0% as of December 31, 2023.

For the first nine months of 2024, we paid $1,571 of cash under our vendor financing program, compared to $4,736 in the prior-year comparable period. Total vendor financing payables included in our September 30, 2024 consolidated balance sheet were $1,660, with $843 due within one year (in “Accounts payable and accrued liabilities”) and the remainder predominantly due within five years (in “Other noncurrent liabilities”).

At September 30, 2024, we had approximately 144 million shares remaining from our share repurchase authorizations approved by the Board of Directors in 2014.

We paid dividends on common and preferred shares of $6,171 during the first nine months of 2024, compared with $6,116 for the first nine months of 2023.

Dividends on common stock declared by our Board of Directors totaled $0.8325 per share in the first nine months of 2024 and 2023. Our dividend policy considers the expectations and requirements of stockholders, capital funding requirements of AT&T and long-term growth opportunities.

Credit Facilities

The following summary of our various credit and loan agreements does not purport to be complete and is qualified in its entirety by reference to each agreement filed as exhibits to our Annual Report on Form 10-K.

We use credit facilities as a tool in managing our liquidity status. We currently have one $12,000 revolving credit agreement that terminates on November 18, 2028 (Revolving Credit Agreement). No amount was outstanding under the Revolving Credit Agreement as of September 30, 2024.

We also utilize other external financing sources, which include various credit arrangements supported by government agencies to support network equipment purchases as well as a commercial paper program.

AT&T INC.

SEPTEMBER 30, 2024

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations- Continued

Dollars in millions except per share amounts

Our Revolving Credit Agreement contains covenants that are customary for an issuer with investment grade senior debt credit rating as well as a net debt-to-EBITDA financial ratio covenant requiring AT&T to maintain, as of the last day of each fiscal quarter, a ratio of not more than 3.75-to-1. As of September 30, 2024, we were in compliance with the covenants for our credit facilities.

Collateral Arrangements

Most of our counterparty collateral arrangements require cash collateral posting by AT&T only when derivative market values exceed certain thresholds. Under these arrangements, which cover the majority of our approximate $35,400 derivative portfolio, counterparties are still required to post collateral. During the first nine months of 2024, we posted $3 of cash collateral, on a net basis. Cash postings under these arrangements vary with changes in credit ratings and netting agreements. (See Note 7)

Other

Our total capital consists of debt (long-term debt and debt maturing within one year), redeemable noncontrolling interest and stockholders’ equity. Our capital structure does not include debt issued by our equity method investments. At September 30, 2024, our debt ratio was 52.2%, compared to 53.5% at September 30, 2023 and 53.5% at December 31, 2023. The debt ratio is affected by the same factors that affect total capital, and reflects our recent debt issuances, repayments and reclassifications related to redemption of noncontrolling interests.

At September 30, 2024, we had no interest rate swaps.

We have fixed-to-fixed and floating-to-fixed cross-currency swaps on foreign currency-denominated debt instruments with a U.S. dollar notional value of $35,351 to hedge our exposure to changes in foreign currency exchange rates and interest rates. These derivatives have been designated as cash flow or fair value hedges with a net fair value of $(2,732) at September 30, 2024.

The registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed by the registrant is recorded, processed, summarized, accumulated and communicated to its management, including its principal executive and principal financial officers, to allow timely decisions regarding required disclosure, and reported within the time periods specified in the SEC’s rules and forms. The Chief Executive Officer and Chief Financial Officer have performed an evaluation of the effectiveness of the design and operation of the registrant’s disclosure controls and procedures as of September 30, 2024. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the registrant’s disclosure controls and procedures were effective as of September 30, 2024.

There have not been any changes in our internal control over financial reporting during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

AT&T INC.

SEPTEMBER 30, 2024

CAUTIONARY LANGUAGE CONCERNING FORWARD-LOOKING STATEMENTS

Information set forth in this report contains forward-looking statements that are subject to risks and uncertainties, and actual results could differ materially. Many of these factors are discussed in more detail in the “Risk Factors” section herein and in our most recent Form 10-K and Form 10-Q. We claim the protection of the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995.

The following factors could cause our future results to differ materially from those expressed in the forward-looking statements:

• Adverse economic and political changes, including inflation and rising interest rates, war or other hostilities, and public health emergencies, and our ability to access financial markets at favorable rates and terms.

• Increases in our benefit plans’ costs, including due to worse-than-assumed investment returns and discount rates, mortality assumptions, medical cost trends, or healthcare laws or regulations.

• The final outcome of FCC and other federal, state or foreign government agency proceedings (including judicial review of such proceedings) and legislative and regulatory efforts involving issues important to our business, including, without limitation, pending Notices of Apparent Liability; the transition from legacy technologies to IP-based infrastructure, including the withdrawal of legacy TDM-based services; universal service; broadband deployment; wireless equipment siting regulations and, in particular, siting for 5G service; E911 services; rules concerning digital discrimination; competition policy; privacy; net neutrality; copyright protection; availability of new spectrum on fair and balanced terms; and wireless and satellite license awards and renewals, and our response to such legislative and regulatory efforts.

• Enactment of or changes to state, local, federal and/or foreign tax laws and regulations, and actions by tax agencies and judicial authorities that reduce our incentive to invest in our networks, and the resolution of disputes with any taxing jurisdictions, pertaining to our subsidiaries and foreign investments.

• U.S. and foreign laws and regulations regarding intellectual property rights protection and privacy, personal data protection and user consent, which are complex and rapidly evolving.

• Our ability to compete in an increasingly competitive industry and against competitors that can offer product/service offerings at lower prices due to lower cost structures and regulatory and legislative actions adverse to us, including non-regulation of comparable alternative technologies and/or government-owned or subsidized networks, and our response to such competition and emerging technologies.

• Disruption in our supply chain for a number of reasons, including, difficulties in obtaining export licenses for certain technology, an inability to secure component parts, lack of suppliers, general business disruption, workforce shortage, natural disasters, safety issues, vendor fraud, and economic and political instability, including disruptions in the capital markets, the outbreak of war or other hostilities, and public health emergencies.

• The development and delivery of attractive and profitable wireless and broadband offerings and devices, including our ability to match speeds offered by competitors; the impact of regulatory and build-out requirements; and the availability, cost and/or reliability of technologies required to provide such offerings.

• Our ability to adequately fund additional wireless spectrum and network development, deployment and maintenance; and regulations and conditions relating to spectrum use, licensing, obtaining additional spectrum, technical standards and deployment and usage, including network management rules.

• Our ability to manage growth in wireless data services, including network quality and acquisition of adequate spectrum at reasonable costs and terms.

• The outcome of pending, threatened or potential litigation and arbitration, including, without limitation, patent and product safety claims by or against third parties or claims based on alleged misconduct by employees.

• The impact from major equipment, software or other failures or errors that disrupt our networks or cyber incidents; the effect of security breaches related to the network or customer information; our inability to obtain handsets, equipment/software or have handsets, equipment/software serviced in a timely and cost-effective manner from suppliers; or severe weather conditions or other natural disasters including earthquakes and forest fires, public health emergencies, energy shortages, wars or terrorist attacks.

• The issuance by the FASB or other accounting oversight bodies of new or revised accounting standards.

• The uncertainty surrounding further congressional action regarding spending and taxation, which may result in changes in government spending and affect the ability and willingness of businesses and consumers to spend in general.

• Our ability to realize or sustain the expected benefits of our business transformation initiatives, which are designed to reduce costs, enable legacy rationalization, streamline distribution, remove redundancies and simplify and improve processes and support functions.

• Our ability to successfully complete divestitures, as well as achieve our expectations regarding the financial impact of completed and/or pending transactions.

Readers are cautioned that other factors discussed in this report and our most recent Form 10-K, although not enumerated here, also could materially affect our future earnings.

AT&T INC.

SEPTEMBER 30, 2024

PART II – OTHER INFORMATION

Dollars in millions except per share amounts

We discuss in our Annual Report on Form 10-K for the year ended December 31, 2023 and in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 various risks that may materially affect our business. We use this section to update this discussion to reflect material developments. For the third quarter of 2024, there were no such material developments.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(c) A summary of our repurchases of common stock during the third quarter of 2024 is as follows:

						(a)						(b)						(c)						(d)
Period						Total Number of Shares (or Units) Purchased****1, 2						Average Price Paid Per Share (or Unit)						Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs****1						Maximum Number (or Approximate Dollar Value) of Shares (or Units) That May Yet Be Purchased Under The Plans or Programs
July 1, 2024 - July 31, 2024						8,053						$	18.82					—						143,731,972
August 1, 2024 - August 31, 2024						20,122						19.40						—						143,731,972
September 1, 2024 - September 30, 2024						2,003,853						21.63						—						143,731,972
Total						2,032,028						$	21.59					—
1In March 2014, our Board of Directors approved an authorization to repurchase up to 300 million shares of our common stock. The authorization has no expiration date.
2These shares were acquired through the withholding of taxes on the vesting of restricted stock and performance shares or in respect of the exercise price of options.

(c) During the quarter ended September 30, 2024, no director or officer (as defined in Rule 16a-1(f)) of the Company adopted or terminated a contract, instruction or written plan for the purchase or sale of securities of the Company intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) and/or a non-Rule 10b5-1 trading arrangement.

AT&T INC.

SEPTEMBER 30, 2024

The following exhibits are filed or incorporated by reference as a part of this report:

Exhibit
Number						Exhibit Description
2.1						Securities Purchase Agreement, dated September 29, 2024, by and among AT&T Services, Inc., AT&T Diversified MVPD Holdings LLC, AT&T MVPD Holdings LLC, Merlin Parent 2024, Inc., TPG Partners IX, L.P. and DIRECTV Entertainment Holdings LLC*
10.1						Third Amended and Restated Limited Liability Corporation of NCWPCS MPL Holdings, LLC*
10.2						Short Term Incentive Plan
31						Rule 13a-14(a)/15d-14(a) Certifications
						31.1 Certification of Principal Executive Officer
						31.2 Certification of Principal Financial Officer
32						Section 1350 Certifications
101						The following financial statements from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, formatted in Inline XBRL: (i) Consolidated Statements of Cash Flows, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Balance Sheets, and (v) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags.
104						The cover page from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, (formatted as Inline XBRL and contained in Exhibit 101).
* Certain schedules (or similar attachments) have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant agrees to furnish copies of such schedules (or similar attachments) to the U.S. Securities and Exchange Commission upon request.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			AT&T Inc.
October 29, 2024			/s/ Pascal Desroches
			Pascal Desroches
			Senior Executive Vice President
			and Chief Financial Officer