DALLAS, May 22, 2023 /PRNewswire/ -- John Stankey, chief executive officer, AT&T* Inc., (NYSE:T) spoke today at the J.P. Morgan Stanley Technology, Media and Telecom Conference where he provided an update to shareholders. Stankey made the following points:
Stankey reiterated his confidence in the company's ability to deliver free cash flow of $16 billion or better for full-year 2023. His confidence reflects expectations for continued adjusted EBITDA growth of 3%+ for the year, driven by steady operational execution and ongoing benefits from the company's cost reduction initiatives. Similarly, Stankey said he has high visibility into key factors that disproportionately impacted free cash flow conversion in the first quarter, including annual incentive compensation that is paid in the first quarter. Two primary factors will drive improved free cash flow conversion in the remainder of 2023. First, Stankey expects that handset payments peaked in the first quarter and will be lower for full-year 2023 compared to 2022. Additionally, he expects capital investment to be broadly in line with guidance for the remainder of 2023, following a year-over-year increase in the first quarter.
AT&T continues to prioritize adding high-quality durable customer relationships that will drive sustainable, profitable long-term growth. In wireless, Stankey said he expects second-quarter postpaid net additions to be influenced by three factors:
The company remains on track with its network expansion commitments and expects to deploy midband spectrum to 200 million people by year-end 2023 and to pass 30 million+ customer and business locations in its traditional service area with fiber by the end of 2025. Stankey believes AT&T's position as the largest-scale domestic fiber builder gives it an advantage in managing costs, despite build and labor costs that have moderately impacted the company's fiber build. In addition, AT&T is already seeing lower maintenance and repair costs where fiber has been deployed. The combination of better initial penetration rates and higher ARPU levels have improved the return case on AT&T's fiber investments. These improved returns are offsetting any increase in deployment costs. With the recent close of the Gigapower joint venture with BlackRock, AT&T remains committed in its mission to bring more Americans access to super-fast, reliable, high-capacity fiber.
We help more than 100 million U.S. families, friends and neighbors, plus nearly 2.5 million businesses, connect to greater possibility. From the first phone call 140+ years ago to our 5G wireless and multi-gig internet offerings today, we @ATT innovate to improve lives. For more information about AT&T Inc. (NYSE:T), please visit us at about.att.com. Investors can learn more at investors.att.com.
Cautionary Language Concerning Forward-Looking Statements
Information set forth in this news release contains financial estimates and other forward-looking statements that are subject to risks and uncertainties, and actual results might differ materially. A discussion of factors that may affect future results is contained in AT&T's filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update and revise statements contained in this news release based on new information or otherwise.
This news release may contain certain non-GAAP financial measures. Reconciliations between the non-GAAP financial measures and the GAAP financial measures are available on the company's website at https://investors.att.com.
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