11:41 AM EDT, 10/23/2024 (MT Newswires) -- (Corrects Visible Alpha consensus estimate in fifth paragraph.)

AT&T ( T ) reported an unexpected decline in third-quarter revenue amid challenges in business wireline that led to a multi-billion dollar write-down, though it remains on track to meet its full-year targets.

Revenue dipped to $30.21 billion for the three months ended Sept. 30 from $30.35 billion the year earlier, compared with the $30.45 billion average analyst estimate on Capital IQ. Adjusted earnings per share slid to $0.60 from $0.64 but topped the Street's $0.57 view. The telecommunication giant's shares were up 2.5% in Wednesday trade.

The decline in revenue reflected softer business wireline service performance and lower mobility equipment revenue, which were mostly offset by growth in wireless service and fiber revenues, Chief Financial Officer Pascal Desroches told analysts on a conference call, according to a Capital IQ transcript.

While excluded from adjusted earnings, AT&T ( T ) took a $4.4 billion noncash goodwill impairment charge for its business wireline unit in the third quarter, reflecting "an industry-wide secular decline of legacy services," Desroches said on the call.

Service revenue edged up 0.1% to $25.13 billion while equipment sales fell 3% to $5.08 billion. AT&T's ( T ) postpaid phone net additions fell about 14% year over year to 403,000, compared with the Visible Alpha consensus for a 393,400 reading.

Adjusted earnings before interest, taxes, depreciation and amortization advanced 3.4% in the third quarter, while the company continues to expect the metric to climb in the 3% range for the full year, Desroches told analysts. That's despite a roughly $115 million financial impact related to hurricanes Helene and Milton, with the consumer and business wireline businesses expected to bear most of the impact.

AT&T ( T ) reiterated its full-year adjusted EPS guidance of $2.15 to $2.25, which is in line with the $2.20 Capital IQ consensus. It continues to expect wireless service revenue growth in the 3% range and broadband revenue growth of at least 7%.

Growth in broadband partly reflects fiber momentum, according to Desroches. Third-quarter broadband revenues increased 6.4%, driven by fiber revenue growth of nearly 17%. "We continue to see solid uptake in higher-speed fiber tiers and healthy underlying pricing trends," he said.

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