AT&T Inc. is set to unveil its strategic growth plan during a fireside chat at the UBS Global Media & Communications Conference on December 10, 2024. The plan aims to enhance customer experience and drive investments in network infrastructure, positioning AT&T as a leading connectivity provider in the United States. The focus will be on the company's progress and future goals, emphasizing customer-centric services and robust network capabilities.
AT&T plans to modernize its wireless network, particularly focusing on 5G technology. By 2027, the company aims to complete the modernization of its 5G network, utilizing open technology and deep mid-band spectrum to cover over 300 million people by the end of 2026. This investment in mobility infrastructure is expected to create a more efficient, high-capacity network that meets the evolving demands of consumers and businesses.
In addition to wireless ambitions, AT&T is making strides in broadband services. The company plans to expand its fiber broadband network to over 50 million locations by the end of 2029, achieved through organic growth and partnerships. By transitioning away from legacy copper networks, AT&T aims to deliver converged services that cater to the diverse needs of its customer base.
AT&T is on track to meet its financial and operational guidance shared during its 2024 Analyst & Investor Day. The company projects a Free Cash Flow of over $16 billion for 2025, excluding contributions from DIRECTV. Key drivers for this growth include an increase in Adjusted EBITDA, reduced cash interest due to lower debt levels, and a favorable working capital environment.
AT&T's strategic plan is projected to generate over $50 billion in financial capacity over the next three years, primarily through organic growth. This financial capacity is defined as the anticipated Free Cash Flow after distributions to noncontrolling interests, along with expected cash inflows from the sale of AT&T's stake in DIRECTV to TPG. The company aims to achieve a net leverage target of approximately 2.5 times net-debt-to-adjusted EBITDA by the first half of 2025, maintaining this level through 2027.
A significant portion of the financial capacity will be returned to shareholders, with AT&T planning to distribute over $40 billion through dividends and share repurchases. The company intends to uphold its current annualized common stock dividend of $1.11 per share, resulting in total dividend payments exceeding $20 billion from 2025 to 2027. Additionally, AT&T has earmarked around $20 billion for share repurchases, alongside approximately $10 billion in financial flexibility for strategic investments, debt repayment, and other shareholder returns.
AT&T's strategic initiatives and financial plans aim to enhance the company's market position and deliver value to its shareholders. The commitment to customer-first services, coupled with substantial investments in network infrastructure, underscores AT&T's determination to lead in the competitive connectivity landscape.