CEO & Chairman, AT&T Inc.
AT&T CEO says AI will CHANGE the future of connectivity
AT&T CEO John Stankey joins 'Mornings with Maria' to discuss Q2 earnings, highlighting strong subscriber growth and margins, details the company's $250 billion commitment through 2030 for AI infrastructure, their partnership with Palo Alto Networks and more.
00:00 AT&T Q2 Earnings Breakdown
01:43 Record Margins and Strategic Growth
03:39 AI Revolution and Symmetrical Fiber Networks
05:57 The $250 Billion Infrastructure Bet
07:31 Telecom Regulation and Market Competition
09:31 Quantum Security and Macro Economic Outlook
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About John Stankey
AT&T Chairman and CEO John Stankey discussed the company's second-quarter 2026 earnings across multiple media appearances on July 22, 2026. He characterized the quarter as "fantastic" and noted that the company returned to business growth, adding 432,000 monthly wireless phone subscribers and a record 370,000 fiber net adds. Stankey attributed the results to investments made over the previous five years and said he expects the trend of accelerated growth to continue through 2028. He described the company's margins as a record and stated that AT&T is "doing a lot better job down market" with more affordable products, which he characterized as "meeting market needs" rather than a price war. Regarding competition from satellite providers like SpaceX's Starlink, Stankey said the company wants to partner with "everybody in the satellite ecosystem" and noted that AT&T, along with T-Mobile and Verizon, established a joint venture to aggregate satellite capacity for the small percentage of traffic that occurs off-network. He also discussed the company's commitment to investing $250 billion through 2030 in AI infrastructure and symmetrical fiber networks, stating that he believes AT&T is "uniquely positioned" to serve AI workloads and that the market will eventually recognize the value of these investments. Stankey acknowledged that there has been "some rotation out of our stock" as investors move toward AI opportunities, but expressed confidence that the company's valuation will "ultimately correct itself."
Transcript (15 segments)
M
Maria0:10
AT&T reporting second-quarter earnings, setting stock up 3.5% at $23.02. A slight miss on revenue, connectivity subscribers from the fiber, fixed wireless and postpaid phones. Joining is the CEO and Chairman John Stankey. Let's talk about what drove business. All the investment you were putting into the company and into firebrand wireless over the last several years is playing out in this quarter. How would you characterize the quarter?
J
John Stankey0:49
You hit the nail on the head. We indicated as we gave guidance the next two years because of the investments you alluded to, we would see a step up and accelerated growth, and that is what you saw this quarter. Really strong customer subscriber members, a million strategic new customers on the core products going forward in the future. Account formation, which means new customers at a 3-year high, so that was a strong performance. And as a result of that, you saw a little growth, accelerated source revenue growth. Obviously, the confidence we were able to move our guidance on EPS for the balance of the year to the higher end of our guide as a result of that, and the growth has been strong. Look at the margins. I can't go back that far, but this may have been the best margins we've had since I have been in this job, and our strongest margins ever. It was a strong effort, well-balanced and good performance.
M
Maria2:02
The margins looking like the best you have ever seen. In terms of the second half of the year into the new year, what is your expectation?
J
John Stankey2:14
We will keep going. The first step up, we made some key strategic decisions for new footprint from a former company in the space we operate, and as a result we have an opportunity to continue this run. This is what we are telling our investors: organic investment plus the new footprint puts us in a unique position that even though we are in a more mature industry in terms of customers that have product and service, when you are building a better product, your growth can be strong, and that is what we are demonstrating. We expect to carry that forward bolstered by the fact this quarter we saw growth in business revenue on strategic services. When we have all the cylinders hitting, this will be a strong engine.
M
Maria3:11
Investors are reacting after what has been a flat to down showing, 100% free cash flow to shareholders, we want to look longer term. We don't like to look short-term, but I want your take on broadband subscriber growth. We were talking about SpaceX with Cathie Wood. Some believe mobile is at risk with the rising threat of satellite. How does AT&T deal with that?
J
John Stankey3:51
That's why we are making the investments we are making, building the infrastructure we think will match drive returns and the AI revolution moving forward. One reason we've gone into fiber is we believe AI workloads will require more networking, the same amount of bandwidth upstream as downstream, and broadband networks in the consumer space have more downstream than upstream. We invest in the best technology at the lowest marginal cost to carry work loads. Sometimes we drop the fiber to someone's house, but sometimes we put it to the cell site. Between that and the customer before the traffic gets on the fiber, that allows us to have ultra-high performing fiber networks that support wireless as well. We are in a position from a technology perspective – the infrastructure – it will be hard to meet the service expectations of the AI generation. We invest significant money not just outside but inside as well, if you go to a stadium or hospital or university or large office building. You don't cover those with outside cellular towers; you build infrastructure, and it takes years and a lot of money, but to deliver that consistency requires dense fiber, huge investment in wireless technology to make that happen. We are future-proofing our network and feel good about where we are. People buying chips or memory or building data centers – the data communications network is an important part of the AI revolution moving forward, and we will be very competitive.
M
Maria5:43
SpaceX tries to tell us it has multiple addressable markets. AT&T is moving toward accelerating infrastructure for hyper connectivity to reduce costly outages nationwide. Tell us about your commitment of $250 billion on this AI buildout.
J
John Stankey6:06
We have been investing over the last five years at a rate that's higher than everybody else in our industry. This infrastructure is irrefutable moving forward; we will see more symmetrical workloads. Our commitment is we will continue to do this through 2030. We believe at that point we get to a competitive footprint that will be hard to catch or touch, and that will distinguish this business and make us the best provider of the market and make us incredibly competitive. And it takes some guts to do this. You think about this from the long-term. It means sometimes you will get short-term dislocations, and what happened with the stock price the last couple months. You have to be consistent and persistent. It takes multiple years to get a flywheel going, but if you stick with it, once the flywheel gets going it throws off a lot of cash and is a very successful return. That is the bet we are playing.
M
Maria7:16
What do you expect in the way of regulation? Some analysts talk about regulatory support for SpaceX. It is an important component for government, but in terms of regulating, in the way of regulation, to see that growth launch?
J
John Stankey7:44
There are things on the edges. This administration has it right. If you think back to 1990, put in place the Telecom Act in our industry was to move out of regulated markets. Intermodal competition and new players and new entrants compete with each other. I never thought it would take as long as it did, but we are here. Four broadband providers today was unheard of 15 years ago. Now that we have intermodal competition and all this investment and bandwidth going up, the next step is you don't need regulation. Markets take care of these issues. The FCC is looking at opportunities to come back and say there are markets we regulated that we no longer need to do that, or do it in a different way, and I applaud that. That's where we are. Markets are taking care of things. The vast majority of Americans live today, but still areas in rural areas you need to be more careful about those things. It's not a more active regulatory posture.
M
Maria9:10
You did these investments in fiber, wireless and broadband so long ago set you up to best compete with this change where you expect SpaceX to enter mobile. I understand the vision you had in terms of the investment. AT&T releasing quantum resilience fabric for enterprise customers. Tell us about that. Quantum fabric is so powerful.
J
John Stankey9:47
Everyone is looking at the next ways, how quantum comes upon us. They had a lot of new challenges in what it is capable to do. They are no longer going to be effective in the quantum world. Our work with Palo Alto takes what they do well, marries with some of the information coming off of the network so you can get better security with the two together that would withstand the abilities of quantum moving forward. We are taking the first steps toward a long road of innovation that will be necessary to recast cybersecurity and enterprises for the future. We have a lot going on in this space because of the fight on the AI evolution. A revolution is more accurate, so this is going to be a long road of innovation.
M
Maria10:57
The competition with Starlink and SpaceX aside, your wireless footprint, what the macro story feels like now?
J
John Stankey11:09
I read the same things you read. The behavior is such that you are in the economy. We don't see a softness. You have to be more complete in the portfolio so you can participate more actively driving share in the value segment and more affordable price points. And it is as strong as it is. And price points in the market we haven't hit before. We've got the right kind of infrastructure in an effective cost structure. And I don't expect to see that changing anytime soon.
M
Maria12:10
Great to have you, thanks so much, John Stankey.