8-K - T - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________________________________________________

FORM 8-K

______________________________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported) April 23, 2025

______________________________________________________

AT&T INC.

(Exact Name of Registrant as Specified in Charter)

______________________________________________________

Delaware	001-08610	43-1301883
(State or Other Jurisdiction<br>of Incorporation)	(Commission<br>File Number)	(IRS Employer<br>Identification No.)
208 S. Akard St., Dallas, Texas<br><br>(Address of Principal Executive Offices)		75202<br><br>(Zip Code)

Registrant’s telephone number, including area code (210) 821-4105

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240-14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities Registered Pursuant to Section 12(b) of the Act

Title of each class	Trading<br>Symbol(s)	Name of each exchange<br>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
Title of each class	Trading<br><br>Symbol(s)	Name of each exchange<br><br>on which registered
---	---	---
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. 3.150% Global Notes due June 1, 2030	T 30C	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
AT&T Inc. 3.550% Global Notes due December 17, 2032	T 32	New York Stock Exchange
AT&T Inc. 3.600% Global Notes due June 1, 2033	T 33A	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. 4.050% Global Notes due June 1, 2037	T 37B	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

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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. ☐

Item 2.02 Results of Operations and Financial Condition.

The registrant announced on April 23, 2025, its results of operations for the first quarter of 2025. The text of the press release and accompanying financial information are attached as exhibits and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

The following exhibits are furnished as part of this report:

(d)	Exhibits
	99.1	Press release dated April 23, 2025 reporting financial results for the first quarter ended March 31, 2025
	99.2	AT&T Inc. selected financial statements and operating data.
	99.3	Discussion and reconciliation of non-GAAP measures.
	104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

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 hereunto duly authorized.

	AT&T INC.
Date: April 23, 2025	By: /s/ Sabrina Sanders .<br><br>Sabrina Sanders<br><br>Senior Vice President - Chief Accounting Officer<br><br>and Controller

Document

AT&T Delivers Strong First-Quarter Financial Performance

Company reiterates full-year 2025 financial and operational guidance

DALLAS, April 23, 2025 — AT&T Inc. (NYSE: T) reported solid first-quarter results that again showcase its ability to grow the right way with high-quality, profitable 5G and fiber subscriber additions. The Company reiterates all 2025 full-year financial and operational guidance. Based on the reduction in net debt and the Company's outlook, AT&T is operating within its net leverage target of net debt-to-adjusted EBITDA* in the 2.5x range and plans to commence share repurchases in the second quarter.

“Our business fundamentals remain strong, and we are uniquely positioned to win in this dynamic and competitive market,” said John Stankey, AT&T Chairman and CEO. “We are growing the right way as customers continue to choose AT&T Fiber and 5G wireless for connectivity they can rely on, guaranteed or we'll make it right. The priorities we laid out at our 2024 Analyst & Investor Day have not changed, and we continue to operate our business to achieve the financial plan and capital returns we outlined in December.”

First-Quarter Consolidated Results

•Revenues of $30.6 billion

•Diluted EPS of $0.61 versus $0.47 a year ago; adjusted EPS* of $0.51 versus $0.48 a year ago

•Operating income of $5.8 billion; adjusted operating income* of $6.4 billion

•Net income of $4.7 billion; adjusted EBITDA* of $11.5 billion

•Cash from operating activities of $9.0 billion, versus $7.5 billion a year ago

•Capital expenditures of $4.3 billion; capital investment* of $4.5 billion

•Free cash flow* of $3.1 billion, versus $2.8 billion a year ago

First-Quarter Highlights

•324,000 postpaid phone net adds with postpaid phone churn of 0.83%

•Mobility service revenues of $16.7 billion, up 4.1% year over year

•261,000 AT&T Fiber net adds; 200,000, or more, net adds for 21 consecutive quarters

•Consumer fiber broadband revenues of $2.1 billion, up 19.0% year over year

•29.5 million consumer and business locations passed with fiber

•More than 4 out of every 10 AT&T Fiber households now choose AT&T wireless1

* Further clarification and explanation of non-GAAP measures and reconciliations to their most comparable GAAP measures can be found in the “Non-GAAP Measures and Reconciliations to GAAP Measures” section of the release and at investors.att.com.

2025 Outlook

For the full year, AT&T expects:

•Consolidated service revenue growth in the low-single-digit range.

•Mobility service revenue growth in the higher end of the 2% to 3% range.

•Consumer fiber broadband revenue growth in the mid-teens.

•Adjusted EBITDA* growth of 3% or better.

•Mobility EBITDA* growth in the higher end of the 3% to 4% range.

•Business Wireline EBITDA* to decline in the mid-teens range.

•Consumer Wireline EBITDA* growth in the high-single to low-double-digit range.

•Capital investment* in the $22 billion range.

•Free cash flow* of $16 billion+.

•Adjusted EPS* of $1.97 to $2.07.

Additionally, the Company continues to expect the sale of its entire 70% stake in DIRECTV to TPG to close in mid-2025.

Note: AT&T’s first-quarter earnings conference call will be webcast at 8:30 a.m. ET on Wednesday, April 23, 2025. The webcast and related materials, including financial highlights, will be available at investors.att.com.

Consolidated Financial Results

•Revenues for the first quarter totaled $30.6 billion versus $30.0 billion in the year-ago quarter, up 2.0%. This was due to higher Mobility and Consumer Wireline revenues, partially offset by declines in Business Wireline and Mexico, which included unfavorable foreign exchange impacts.

•Operating expenses were $24.9 billion versus $24.2 billion in the year-ago quarter. Operating expenses increased primarily due to higher equipment costs associated with higher wireless equipment revenues and higher restructuring costs. Additionally, depreciation increased from our continued fiber investment and network upgrades, partially offset by lower impacts from our Open RAN network modernization efforts. These increases were partially offset by expense declines from continued transformation efforts and lower network related costs, which included lower negotiated rates and higher vendor settlements in 2025, as well as the absence of expenses from our cybersecurity business that was contributed to a new joint venture, LevelBlue, in the second quarter of 2024.

•Operating income was $5.8 billion, essentially consistent with the year-ago quarter. When adjusting for certain items, adjusted operating income* was $6.4 billion versus $6.0 billion in the year-ago quarter.

•Equity in net income of affiliates was $1.4 billion, primarily from the DIRECTV investment, versus $0.3 billion in the year-ago quarter, reflecting cash distributions received by AT&T in excess of the carrying amount of our investment in DIRECTV.

•Net income was $4.7 billion versus $3.8 billion in the year-ago quarter.

•Net income attributable to common stock was $4.4 billion versus $3.4 billion in the year-ago quarter. Earnings per diluted common share was $0.61 versus $0.47 in the year-ago quarter. Adjusting for ($0.10) which removes equity in net income of DIRECTV and excludes restructuring costs and other items, adjusted earnings per diluted common share* was $0.51 versus $0.48 in the year-ago quarter.

•Adjusted EBITDA* was $11.5 billion versus $11.0 billion in the year-ago quarter.

•Cash from operating activities was $9.0 billion, versus $7.5 billion in the year-ago quarter, reflecting $1.4 billion cash flows related to DIRECTV, which included a $1.1 billion dividend, and operational growth.

•Capital expenditures were $4.3 billion versus $3.8 billion in the year-ago quarter. Capital investment* totaled $4.5 billion versus $4.6 billion in the year-ago quarter. Cash payments for vendor financing totaled $0.2 billion versus $0.8 billion in the year-ago quarter.

•Free cash flow,* which excludes cash flows from DIRECTV, was $3.1 billion versus $2.8 billion in the year-ago quarter.

•Total debt was $126.2 billion at the end of the first quarter, and net debt* was $119.1 billion.

Segment and Business Unit Results

Communications Segment
Dollars in millions	First Quarter						Percent
Unaudited	2025			2024			Change
Operating Revenues	$	29,560		$	28,857		2.4	%
Operating Income	6,991			6,745			3.6	%
Operating Income Margin	23.7		%	23.4		%	30	BP

Communications segment revenues were $29.6 billion, up 2.4% year over year, with operating income up 3.6% year over year.

Mobility
Dollars in millions; Subscribers in thousands	First Quarter						Percent
Unaudited	2025			2024			Change
Operating Revenues	$	21,570		$	20,594		4.7	%
Service	16,651			15,994			4.1	%
Equipment	4,919			4,600			6.9	%
Operating Expenses	14,830			14,126			5.0	%
Operating Income	6,740			6,468			4.2	%
Operating Income Margin	31.2		%	31.4		%	(20)	BP
EBITDA*	$	9,266		$	8,955		3.5	%
EBITDA Margin*	43.0		%	43.5		%	(50)	BP
EBITDA Service Margin*	55.6		%	56.0		%	(40)	BP
Total Wireless Net Adds2	120			741
Postpaid	290			389
Postpaid Phone	324			349
Postpaid Other	(34)			40
Prepaid Phone	(20)			1
Postpaid Churn	0.99		%	0.89		%	10	BP
Postpaid Phone-Only Churn	0.83		%	0.72		%	11	BP
Prepaid Churn	2.64		%	2.77		%	(13)	BP
Postpaid Phone ARPU	$	56.56		$	55.57		1.8	%

Mobility service revenue grew 4.1% year over year driving EBITDA growth of 3.5%. Postpaid phone net adds were 324,000 with postpaid phone ARPU up 1.8% year over year.

Mobility revenues were up 4.7% year over year driven by service revenue growth of 4.1% from postpaid phone average revenue per subscriber (ARPU) growth and subscriber gains, as well as equipment revenue growth of 6.9% from higher wireless device sales volumes. Operating expenses were up 5.0% year over year due to higher equipment expenses from higher wireless sales volumes. This increase also reflects higher advertising costs due to the launch of a new campaign, higher promotion costs, higher network costs and increased depreciation expense. Operating income was $6.7 billion, up 4.2% year over year. EBITDA* was $9.3 billion, up $311 million year over year.

Business Wireline
Dollars in millions	First Quarter						Percent
Unaudited	2025			2024			Change
Operating Revenues	$	4,468		$	4,913		(9.1)	%
Operating Expenses	4,566			4,849			(5.8)	%
Operating Income/(Loss)	(98)			64			—	%
Operating Income Margin	(2.2)		%	1.3		%	(350)	BP
EBITDA*	$	1,400		$	1,426		(1.8)	%
EBITDA Margin*	31.3		%	29.0		%	230	BP

Business Wireline revenues declined year over year driven by continued secular pressures on legacy and other transitional services that were partially offset by growth in fiber and advanced connectivity services.

Business Wireline revenues were down 9.1% year over year, due to declines in legacy and other transitional services of 17.4%, partially offset by growth in fiber and advanced connectivity services of 4.5%. Revenue declines were also impacted by the absence of revenues from our cybersecurity business that was contributed to LevelBlue during the second quarter of 2024, and targeted pricing actions in legacy services. Operating expenses were down 5.8% year over year due to lower personnel costs associated with ongoing transformation initiatives, lower network access costs that included higher vendor settlements in 2025 and the contribution of our cybersecurity business, partially offset by higher depreciation expense due to ongoing investment for strategic initiatives such as fiber. Operating income was $(98) million versus $64 million in the prior-year quarter, and EBITDA* was $1.4 billion, slightly lower year-over-year.

Consumer Wireline
Dollars in millions; Subscribers in thousands	First Quarter						Percent
Unaudited	2025			2024			Change
Operating Revenues	$	3,522		$	3,350		5.1	%
Operating Expenses	3,173			3,137			1.1	%
Operating Income	349			213			63.8	%
Operating Income Margin	9.9		%	6.4		%	350	BP
EBITDA*	$	1,298		$	1,094		18.6	%
EBITDA Margin*	36.9		%	32.7		%	420	BP
Broadband Net Adds3	137			55
Fiber	261			252
Non Fiber	(124)			(197)
AT&T Internet Air	181			110
Broadband ARPU	$	70.87		$	65.98		7.4	%
Fiber ARPU	$	72.85		$	68.61		6.2	%

Consumer Wireline achieved strong broadband revenue driven by 19.0% fiber revenue growth. Consumer Wireline also delivered positive broadband net adds for the seventh consecutive quarter, driven by 261,000 AT&T Fiber net adds and 181,000 AT&T Internet Air net adds.

Consumer Wireline revenues were up 5.1% year over year driven by broadband revenue growth of 9.6% due to fiber revenue growth of 19.0%, partially offset by declines in legacy voice and data services and other services. Operating expenses were up 1.1% year over year, primarily due to higher depreciation expense driven by fiber investment, partially offset by lower customer support and network-related costs that include higher vendor settlements in 2025. Operating income was $349 million versus $213 million in the prior-year quarter, and EBITDA* was $1.3 billion, up $204 million year over year.

Latin America Segment
Dollars in millions; Subscribers in thousands	First Quarter				Percent
Unaudited	2025		2024		Change
Operating Revenues	$	971	$	1,063	(8.7)	%
Service	615		690		(10.9)	%
Equipment	356		373		(4.6)	%
Operating Expenses	928		1,060		(12.5)	%
Operating Income	43		3		—	%
EBITDA*	$	193	$	180	7.2	%
Total Wireless Net Adds	32		143
Postpaid	160		116
Prepaid	(110)		79
Reseller	(18)		(52)

Latin America segment revenues were down 8.7% year over year, primarily due to unfavorable impacts of foreign exchange rates, partially offset by higher equipment sales, and subscriber and ARPU growth. Operating expenses were down 12.5% due to the favorable impacts of foreign exchange rates, partially offset by higher equipment and selling costs resulting from higher sales. Operating income was $43 million compared to $3 million in the year-ago quarter. EBITDA* was $193 million, compared to $180 million in the year-ago quarter.

1Represents the ratio of AT&T Fiber subscribers to the number of primary Mobility account holders that also subscribe to consumer postpaid phone service.

2Excludes migrations between wireless subscriber categories, including connected devices, and acquisition-related activity during the period.

3First-quarter 2025 excludes the impact of subscriber disconnections resulting from the termination of AT&T Internet Air services in markets with unfavorable regulatory requirements.

About AT&T

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.

Non-GAAP Measures and Reconciliations to GAAP Measures

Schedules and reconciliations of non-GAAP financial measures cited in this document to the most directly comparable financial measures under generally accepted accounting principles (GAAP) can be found at investors.att.com and in our Form 8-K dated April 23, 2025. Adjusted diluted EPS, adjusted operating income, EBITDA, adjusted EBITDA, free cash flow, net debt and net debt-to-adjusted EBITDA are non-GAAP financial measures frequently used by investors and credit rating agencies. Prior periods for free cash flow and adjusted diluted EPS have been recast to conform to the current period presentation to remove cash flows and equity in net income from our investment in DIRECTV, which we have agreed to sell to TPG.

Adjusted diluted EPS is calculated by excluding from operating revenues, operating expenses, other income (expenses) and income tax expense, certain significant items that are non-operational or non-recurring in nature, including dispositions and merger integration and transaction costs, actuarial gains and losses, significant abandonments and impairments, benefit-related gains and losses, employee separation and other material gains and losses. Non-operational items arising from asset acquisitions and dispositions include the amortization of intangible assets. While the expense associated with the amortization of certain wireless licenses and customer lists is excluded, the revenue of the acquired companies is reflected in the measure and those assets contribute to revenue generation. We also adjust for net actuarial gains or losses associated with our pension and postemployment benefit plans due to the often-significant impact on our results (we immediately recognize this gain or loss in the income statement, pursuant to our accounting policy for the recognition of actuarial gains and losses). Consequently, our adjusted results reflect an expected return on plan assets rather than the actual return on plan assets, as included in the GAAP measure of income. The tax impact of adjusting items is calculated using the adjusted effective tax rate during the quarter except for adjustments that, given their magnitude, can drive a change in the effective tax rate; in these cases, we use the actual tax expense or combined marginal rate of approximately 25%.

For 1Q25, adjusted EPS of $0.51 is diluted EPS of $0.61 adjusted for $0.05 restructuring, and a net $0.00 benefit-related, transaction, legal and other items, minus $0.15 equity in net income of DIRECTV. For 1Q24, adjusted EPS of $0.48 is diluted EPS of $0.47 adjusted for $0.06 restructuring and impairments, minus $0.03 equity in net income of DIRECTV, and $0.02 benefit-related, transaction, legal and other items. For 1Q25, transaction, legal and other costs include costs associated with legacy legal matters and the expected resolution of certain litigation associated with cyberattacks disclosed in 2024, which is presented net of expected insurance recoveries. The Company expects adjustments to 2025 reported diluted EPS to include an adjustment to remove equity in net income of DIRECTV, a non-cash mark-to-market benefit plan gain/loss, and other items. The adjustment to remove the equity in net income of DIRECTV is dependent upon cash distributions from DIRECTV and the timing of the closing of the sale of our DIRECTV investment, which is expected in mid-2025. The Company expects the mark-to-market adjustment, which is driven by interest rates and investment returns that are not reasonably estimable at this time, to be a significant item. Our projected 2025 adjusted EPS depends on future levels of revenues and expenses, most of which are not reasonably estimable at this time. Accordingly, we cannot provide a reconciliation between this projected non-GAAP metric and the most comparable GAAP metric without unreasonable effort.

Adjusted operating income is operating income adjusted for revenues and costs we consider non-operational in nature, including items arising from asset acquisitions or dispositions. For 1Q25, adjusted operating income of $6.4 billion is calculated as operating income of $5.8 billion plus $0.6 billion of adjustments. For 1Q24, adjusted operating income of

$6.0 billion is calculated as operating income of $5.8 billion plus $0.2 billion of adjustments. Adjustments for all periods are detailed in the Discussion and Reconciliation of Non-GAAP Measures included in our Form 8-K dated April 23, 2025.

EBITDA is net income plus income tax, interest, and depreciation and amortization expenses minus equity in net income of affiliates and other income (expense) – net. Adjusted EBITDA is calculated by excluding from EBITDA certain significant items that are non-operational or non-recurring in nature, including dispositions and merger integration and transaction costs, significant abandonments and impairments, benefit-related gains and losses, employee separation and other material gains and losses.

For 1Q25, adjusted EBITDA of $11.5 billion is calculated as net income of $4.7 billion, plus income tax expense of $1.3 billion, plus interest expense of $1.7 billion, minus equity in net income of affiliates of $1.4 billion, minus other income (expense) – net of $0.5 billion, plus depreciation and amortization of $5.2 billion, plus adjustments of $0.6 billion. For 1Q24, adjusted EBITDA of $11.0 billion is calculated as net income of $3.8 billion, plus income tax expense of $1.1 billion, plus interest expense of $1.7 billion, minus equity in net income of affiliates of $0.3 billion, minus other income (expense) – net of $0.5 billion, plus depreciation and amortization of $5.0 billion, plus adjustments of $0.2 billion. Adjustments for all periods are detailed in the Discussion and Reconciliation of Non-GAAP Measures included in our Form 8-K dated April 23, 2025.

At the segment or business unit level, EBITDA is operating income before depreciation and amortization. EBITDA margin is EBITDA divided by total revenues. EBITDA service margin is EBITDA divided by total service revenues.

Adjusted EBITDA, Mobility EBITDA, Business Wireline EBITDA and Consumer Wireline EBITDA estimates depend on future levels of revenues and expenses which are not reasonably estimable at this time. Accordingly, we cannot provide reconciliations between these projected non-GAAP metrics and the most comparable GAAP metrics without unreasonable effort.

Free cash flow for 1Q25 of $3.1 billion is cash from operating activities of $9.0 billion, less cash distributions from DIRECTV classified as operating activities of $1.4 billion, less cash taxes paid on DIRECTV of $0, minus capital expenditures of $4.3 billion and cash paid for vendor financing of $0.2 billion. For 1Q24, free cash flow of $2.8 billion is cash from operating activities of $7.5 billion, less cash distributions from DIRECTV classified as operating activities of $0.3 billion, less cash taxes paid on DIRECTV of $0.1 billion, minus capital expenditures of $3.8 billion and cash paid for vendor financing of $0.8 billion. Due to high variability and difficulty in predicting items that impact cash from operating activities, capital expenditures and vendor financing payments, the Company is not able to provide a reconciliation between projected free cash flow and the most comparable GAAP metric without unreasonable effort.

Capital investment provides a comprehensive view of cash used to invest in our networks, product developments and support systems. In connection with capital improvements, we have favorable payment terms of 120 days or more with certain vendors, referred to as vendor financing, which are excluded from capital expenditures and reported as financing activities. Capital investment includes capital expenditures and cash paid for vendor financing ($0.2 billion in 1Q25, $0.8 billion in 1Q24). Due to high variability and difficulty in predicting items that impact capital expenditures and vendor financing payments, the Company is not able to provide a reconciliation between projected capital investment and the most comparable GAAP metrics without unreasonable effort.

Net debt of $119.1 billion at March 31, 2025, is calculated as total debt of $126.2 billion less cash and cash equivalents of $6.9 billion and time deposits (i.e. deposits at financial institutions that are greater than 90 days) of $0.2 billion. Net debt-to-adjusted EBITDA is calculated by dividing net debt by the sum of the most recent four quarters of adjusted EBITDA. Net debt and adjusted EBITDA are calculated as defined above.

For more information, contact:

Brittany Siwald

AT&T Inc.

Phone: (214) 202-6630

Email: brittany.a.siwald@att.com

Document

AT&T Inc.
Financial Data
Consolidated Statements of Income
Dollars in millions except per share amounts
Unaudited	First Quarter			Percent
		2025		2024		Change
Operating Revenues
Service		$	25,138	$	24,842	1.2	%
Equipment		5,488		5,186		5.8	%
Total Operating Revenues		30,626		30,028		2.0	%
Operating Expenses
Cost of revenues
Equipment		5,694		5,143		10.7	%
Other cost of revenues (exclusive of depreciation<br><br>and amortization shown separately below)		6,339		6,811		(6.9)	%
Selling, general and administrative		7,145		7,021		1.8	%
Asset impairments and abandonments and restructuring		504		159		—	%
Depreciation and amortization		5,190		5,047		2.8	%
Total Operating Expenses		24,872		24,181		2.9	%
Operating Income		5,754		5,847		(1.6)	%
Interest Expense		1,658		1,724		(3.8)	%
Equity in Net Income of Affiliates		1,440		295		—	%
Other Income (Expense) — Net		455		451		0.9	%
Income Before Income Taxes		5,991		4,869		23.0	%
Income Tax Expense		1,299		1,118		16.2	%
Net Income		4,692		3,751		25.1	%
Net Income Attributable to Noncontrolling Interest		(341)		(306)		(11.4)	%
Net Income Attributable to AT&T		$	4,351	$	3,445	26.3	%
Preferred Stock Dividends and Redemption Gain		44		(50)		—	%
Net Income Attributable to Common Stock		$	4,395	$	3,395	29.5	%
Basic Earnings Per Share Attributable to Common Stock		$	0.61	$	0.47	29.8	%
Weighted Average Common Shares Outstanding (000,000)		7,213		7,192		0.3	%
Diluted Earnings Per Share Attributable to Common Stock		$	0.61	$	0.47	29.8	%
Weighted Average Common Shares Outstanding with Dilution (000,000)		7,223		7,193		0.4	%
AT&T Inc.
---	---	---	---	---
Financial Data
Consolidated Balance Sheets
Dollars in millions
	Mar. 31,		Dec. 31,
	2025		2024
Assets	(Unaudited)
Current Assets
Cash and cash equivalents	$	6,885	$	3,298
Accounts receivable – net of related allowances for credit loss of $357 and $375	9,228		9,638
Inventories	2,593		2,270
Prepaid and other current assets	15,074		15,962
Total current assets	33,780		31,168
Property, Plant and Equipment – Net	128,453		128,871
Goodwill – Net	63,432		63,432
Licenses – Net	127,344		127,035
Other Intangible Assets – Net	5,255		5,255
Investments in and Advances to Equity Affiliates	942		295
Operating Lease Right-Of-Use Assets	21,006		20,909
Other Assets	17,255		17,830
Total Assets	$	397,467	$	394,795
Liabilities and Stockholders’ Equity
Current Liabilities
Debt maturing within one year	$	8,902	$	5,089
Accounts payable and accrued liabilities	33,113		35,657
Advanced billings and customer deposits	3,951		4,099
Dividends payable	2,033		2,027
Total current liabilities	47,999		46,872
Long-Term Debt	117,259		118,443
Deferred Credits and Other Noncurrent Liabilities
Noncurrent deferred tax liabilities	59,144		58,939
Postemployment benefit obligation	9,040		9,025
Operating lease liabilities	17,433		17,391
Other noncurrent liabilities	24,753		23,900
Total deferred credits and other noncurrent liabilities	110,370		109,255
Redeemable Noncontrolling Interest	1,981		1,980
Stockholders’ Equity
Preferred stock	—		—
Common stock	7,621		7,621
Additional paid-in capital	106,302		109,108
Retained earnings	4,215		1,871
Treasury stock	(14,252)		(15,023)
Accumulated other comprehensive income (loss)	(142)		795
Noncontrolling interest	16,114		13,873
Total stockholders’ equity	119,858		118,245
Total Liabilities and Stockholders’ Equity	$	397,467	$	394,795
AT&T Inc.
---	---	---	---	---
Financial Data
Consolidated Statements of Cash Flows
Dollars in millions
Unaudited	First Quarter
	2025		2024
Operating Activities
Net income	$	4,692	$	3,751
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	5,190		5,047
Provision for uncollectible accounts	516		472
Asset impairments and abandonments and restructuring	504		159
Pension and postretirement benefit expense (credit)	(397)		(471)
Net (gain) loss on investments	81		201
Changes in operating assets and liabilities:
Receivables	15		512
Equipment installment receivables and related sales	1,212		24
Contract asset and cost deferral	(147)		101
Inventories, prepaid and other current assets	(661)		(24)
Accounts payable and other accrued liabilities	(3,297)		(3,419)
Changes in income taxes	1,285		1,141
Postretirement claims and contributions	(68)		(54)
Other - net	124		107
Total adjustments	4,357		3,796
Net Cash Provided by Operating Activities	9,049		7,547
Investing Activities
Capital expenditures	(4,277)		(3,758)
Acquisitions, net of cash acquired	(20)		(211)
Dispositions	11		8
Distributions from DIRECTV in excess of cumulative equity in earnings	—		194
(Purchases), sales and settlements of securities and investments - net	45		1,079
Other - net	(717)		(273)
Net Cash Used in Investing Activities	(4,958)		(2,961)
Financing Activities
Net change in short-term borrowings with original maturities of three months or less	—		1,933
Issuance of other short-term borrowings	—		491
Repayment of other short-term borrowings	—		(1,996)
Issuance of long-term debt	2,956		—
Repayment of long-term debt	(1,526)		(4,685)
Payment of vendor financing	(203)		(841)
Redemption of preferred stock	(2,075)		—
Purchase of treasury stock	(218)		(157)
Issuance of treasury stock	17		—
Issuance of preferred interests in subsidiary	2,221		—
Dividends paid	(2,091)		(2,034)
Other - net	366		(526)
Net Cash Used in Financing Activities	(553)		(7,815)
Net increase (decrease) in cash and cash equivalents and restricted cash	3,538		(3,229)
Cash and cash equivalents and restricted cash beginning of year	3,406		6,833
Cash and Cash Equivalents and Restricted Cash End of Period	$	6,944	$	3,604
AT&T Inc.
---	---
Consolidated Supplementary Data
Supplementary Financial Data
Dollars in millions except per share amounts
Unaudited	First Quarter				Percent
		2025			2024			Change
Capital expenditures
Purchase of property and equipment		$	4,240		$	3,721		13.9	%
Interest during construction		37			37			—	%
Total Capital Expenditures		$	4,277		$	3,758		13.8	%
Acquisitions, net of cash acquired
Business acquisitions		$	—		$	—		—	%
Spectrum acquisitions		1			145			(99.3)	%
Interest during construction - spectrum		19			66			(71.2)	%
Total Acquisitions		$	20		$	211		(90.5)	%
Cash paid for interest		$	1,804		$	2,077		(13.1)	%
Cash paid for income taxes, net of (refunds)		$	11		$	(9)		—	%
Dividends Declared per Common Share		$	0.2775		$	0.2775		—	%
End of Period Common Shares Outstanding (000,000)		7,196			7,170			0.4	%
Debt Ratio		50.9		%	52.4		%	(150)	BP
Total Employees		139,970			148,290			(5.6)	%

COMMUNICATIONS SEGMENT

The Communications segment provides wireless and wireline telecom and broadband services to consumers located in the U.S. and businesses globally. The Communications segment contains three reporting units: Mobility, Business Wireline and Consumer Wireline.

Segment Results
Dollars in millions
Unaudited	First Quarter				Percent
		2025			2024			Change
Segment Operating Revenues
Mobility		$	21,570		$	20,594		4.7	%
Business Wireline		4,468			4,913			(9.1)	%
Consumer Wireline		3,522			3,350			5.1	%
Total Segment Operating Revenues		29,560			28,857			2.4	%
Segment Operating Income (Loss)
Mobility		6,740			6,468			4.2	%
Business Wireline		(98)			64			—	%
Consumer Wireline		349			213			63.8	%
Total Segment Operating Income		$	6,991		$	6,745		3.6	%
Operating Income Margin		23.7		%	23.4		%	30	BP

Mobility

Mobility provides nationwide wireless service and equipment.

Mobility Results
Dollars in millions
Unaudited	First Quarter				Percent
		2025			2024			Change
Operating Revenues
Service		$	16,651		$	15,994		4.1	%
Equipment		4,919			4,600			6.9	%
Total Operating Revenues		21,570			20,594			4.7	%
Operating Expenses
Operations and support		12,304			11,639			5.7	%
Depreciation and amortization		2,526			2,487			1.6	%
Total Operating Expenses		14,830			14,126			5.0	%
Operating Income		$	6,740		$	6,468		4.2	%
Operating Income Margin		31.2		%	31.4		%	(20)	BP
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited	March 31,				Percent
		2025			2024			Change
Mobility Subscribers
Postpaid		89,463			87,450			2.3	%
Postpaid phone		73,031			71,558			2.1	%
Prepaid		18,955			19,211			(1.3)	%
Reseller		9,542			7,852			21.5	%
Total Mobility Subscribers		117,960			114,513			3.0	%
	First Quarter				Percent
		2025			2024			Change
Mobility Net Additions
Postpaid Phone Net Additions		324			349			(7.2)	%
Total Phone Net Additions		304			350			(13.1)	%
Postpaid		290			389			(25.4)	%
Prepaid		(34)			1			—	%
Reseller		(136)			351			—	%
Total Mobility Net Additions1		120			741			(83.8)	%
Postpaid Churn		0.99		%	0.89		%	10 BP
Postpaid Phone-Only Churn		0.83		%	0.72		%	11 BP
1Excludes migrations between wireless subscriber categories, including connected devices, and acquisition-related activity during the period.

Business Wireline

Business Wireline provides advanced ethernet-based fiber services, IP Voice and managed professional services, our fixed wireless access product, traditional voice and data services and related equipment to business customers.

Business Wireline Results
Dollars in millions
Unaudited	First Quarter				Percent
		2025			2024			Change
Operating Revenues
Legacy and other transitional services		$	2,475		$	2,997		(17.4)	%
Fiber and advanced connectivity services		1,780			1,703			4.5	%
Equipment		213			213			—	%
Total Operating Revenues		4,468			4,913			(9.1)	%
Operating Expenses
Operations and support		3,068			3,487			(12.0)	%
Depreciation and amortization		1,498			1,362			10.0	%
Total Operating Expenses		4,566			4,849			(5.8)	%
Operating Income (Loss)		$	(98)		$	64		—	%
Operating Income Margin		(2.2)		%	1.3		%	(350)	BP

Consumer Wireline

Consumer Wireline provides broadband services, including fiber connections that provide multi-gig services, and AT&T Internet Air (AIA) services, to residential customers in select locations. Consumer Wireline also provides legacy telephony voice communication services.

Consumer Wireline Results
Dollars in millions
Unaudited	First Quarter				Percent
		2025			2024			Change
Operating Revenues
Broadband		$	2,984		$	2,722		9.6	%
Legacy voice and data services		286			342			(16.4)	%
Other service and equipment		252			286			(11.9)	%
Total Operating Revenues		3,522			3,350			5.1	%
Operating Expenses
Operations and support		2,224			2,256			(1.4)	%
Depreciation and amortization		949			881			7.7	%
Total Operating Expenses		3,173			3,137			1.1	%
Operating Income		$	349		$	213		63.8	%
Operating Income Margin		9.9		%	6.4		%	350	BP
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited		March 31,						Percent
		2025			2024			Change
Broadband Connections
Broadband1		14,112			13,784			2.4	%
Fiber Broadband Connections		9,592			8,559			12.1	%
	First Quarter				Percent
		2025			2024			Change
Broadband Net Additions
Broadband Net Additions1,2		137			55			—	%
Fiber Broadband Net Additions		261			252			3.6	%
1Includes AIA.
2First-quarter 2025 excludes the impact of subscriber disconnections resulting from the termination of AIA services in areas with unfavorable regulatory requirements.

LATIN AMERICA SEGMENT

The segment provides wireless services and equipment to customers in Mexico.

Segment Results
Dollars in millions
Unaudited	First Quarter				Percent
		2025			2024			Change
Operating Revenues
Wireless service		$	615		$	690		(10.9)	%
Wireless equipment		356			373			(4.6)	%
Total Segment Operating Revenues		971			1,063			(8.7)	%
Operating Expenses
Operations and support		778			883			(11.9)	%
Depreciation and amortization		150			177			(15.3)	%
Total Segment Operating Expenses		928			1,060			(12.5)	%
Operating Income		$	43		$	3		—	%
Operating Income Margin		4.4		%	0.3		%	410	BP
Supplementary Operating Data
Subscribers and connections in thousands
Unaudited		March 31,						Percent
		2025			2024			Change
Mexico Wireless Subscribers
Postpaid		5,997			5,352			12.1	%
Prepaid		17,376			16,742			3.8	%
Reseller		235			365			(35.6)	%
Total Mexico Wireless Subscribers		23,608			22,459			5.1	%
	First Quarter				Percent
		2025			2024			Change
Mexico Wireless Net Additions
Postpaid		160			116			37.9	%
Prepaid		(110)			79			—	%
Reseller		(18)			(52)			65.4	%
Total Mexico Wireless Net Additions		32			143			(77.6)	%

SUPPLEMENTAL SEGMENT RECONCILIATION

Three Months Ended
Dollars in millions
Unaudited
March 31, 2025
	Revenues		Operations<br>and Support<br>Expenses		Depreciation<br>and<br>Amortization		Operating<br>Income (Loss)
Communications
Mobility	$	21,570	$	12,304	$	2,526	$	6,740
Business Wireline	4,468		3,068		1,498		(98)
Consumer Wireline	3,522		2,224		949		349
Total Communications	29,560		17,596		4,973		6,991
Latin America	971		778		150		43
Segment Total	30,531		18,374		5,123		7,034
Corporate and Other
Corporate:
DTV-related retained costs	—		56		50		(106)
Parent administration support	1		439		8		(446)
Securitization fees	28		214		—		(186)
Value portfolio	66		10		—		56
Total Corporate	95		719		58		(682)
Certain significant items	—		589		9		(598)
Total Corporate and Other	95		1,308		67		(1,280)
AT&T Inc.	$	30,626	$	19,682	$	5,190	$	5,754
March 31, 2024
	Revenues		Operations <br>and Support <br>Expenses		Depreciation <br>and <br>Amortization		Operating<br>Income (Loss)
Communications
Mobility	$	20,594	$	11,639	$	2,487	$	6,468
Business Wireline	4,913		3,487		1,362		64
Consumer Wireline	3,350		2,256		881		213
Total Communications	28,857		17,382		4,730		6,745
Latin America	1,063		883		177		3
Segment Total	29,920		18,265		4,907		6,748
Corporate and Other
Corporate:
DTV-related retained costs	—		134		120		(254)
Parent administration support	—		392		1		(393)
Securitization fees	26		165		—		(139)
Value portfolio	82		26		4		52
Total Corporate	108		717		125		(734)
Certain significant items	—		152		15		(167)
Total Corporate and Other	108		869		140		(901)
AT&T Inc.	$	30,028	$	19,134	$	5,047	$	5,847

Document

Discussion and Reconciliation of Non-GAAP Measures

We believe the following measures are relevant and useful information to investors as they are part of AT&T's internal management reporting and planning processes and are important metrics that management uses to evaluate the operating performance of AT&T and its segments. Management also uses these measures as a method of comparing performance with that of many of our competitors. These measures should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with U.S. generally accepted accounting principles (GAAP). Prior periods have been recast to conform to the current period presentation to remove cash flows and equity in net income from our investment in DIRECTV, which we have agreed to sell to TPG Capital.

Free Cash Flow

Free cash flow is defined as cash from operations minus cash flows related to our DIRECTV equity investment (cash distributions minus cash taxes from DIRECTV), minus capital expenditures and cash paid for vendor financing (classified as financing activities). Free cash flow after dividends is defined as cash from operations minus cash flows related to our DIRECTV equity investment, capital expenditures, cash paid for vendor financing and dividends on common and preferred shares. Free cash flow dividend payout ratio is defined as the percentage of dividends paid on common and preferred shares to free cash flow. We believe these metrics provide useful information to our investors because management views free cash flow as an important indicator of how much cash is generated by routine business operations, including capital expenditures and vendor financing, and makes decisions based on it. Management also views free cash flow as a measure of cash available to pay debt and return cash to shareowners.

Free Cash Flow and Free Cash Flow Dividend Payout Ratio
Dollars in millions
	First Quarter
		2025			2024
Net Cash Provided by Operating Activities		$	9,049		$	7,547
Less: Distributions from DIRECTV classified as operating activities		(1,423)			(324)
Less: Cash taxes paid on DIRECTV		—			149
Less: Capital expenditures		(4,277)			(3,758)
Less: Payment of vendor financing		(203)			(841)
Free Cash Flow		3,146			2,773
Less: Dividends paid		(2,091)			(2,034)
Free Cash Flow after Dividends		$	1,055		$	739
Free Cash Flow Dividend Payout Ratio		66.5		%	73.4		%

Cash Paid for Capital Investment

In connection with capital improvements, we negotiate with some of our vendors to obtain favorable payment terms of 120 days or more, referred to as vendor financing, which are excluded from capital expenditures and reported in accordance with GAAP as financing activities. We present an additional view of cash paid for capital investment to provide investors with a comprehensive view of cash used to invest in our networks, product developments and support systems.

Cash Paid for Capital Investment
Dollars in millions
	First Quarter
		2025		2024
Capital expenditures		$	(4,277)	$	(3,758)
Payment of vendor financing		(203)		(841)
Cash paid for Capital Investment		$	(4,480)	$	(4,599)

EBITDA

Our calculation of EBITDA, as presented, may differ from similarly titled measures reported by other companies. For AT&T, EBITDA excludes other income (expense) – net, and equity in net income (loss) of affiliates, as these do not reflect the operating results of our subscriber base or operations that are not under our control. Equity in net income (loss) of affiliates represents the proportionate share of the net income (loss) of affiliates in which we exercise significant influence, but do not control. Because we do not control these entities, management excludes these results when evaluating the performance of our

primary operations. EBITDA also excludes interest expense and the provision for income taxes. Excluding these items eliminates the expenses associated with our capital and tax structures. Finally, EBITDA excludes depreciation and amortization in order to eliminate the impact of capital investments. EBITDA does not give effect to cash used for debt service requirements and thus does not reflect available funds for distributions, reinvestment or other discretionary uses. EBITDA is not presented as an alternative measure of operating results or cash flows from operations, as determined in accordance with GAAP.

EBITDA service margin is calculated as EBITDA divided by service revenues.

These measures are used by management as a gauge of our success in acquiring, retaining and servicing subscribers because we believe these measures reflect AT&T's ability to generate and grow subscriber revenues while providing a high level of customer service in a cost-effective manner. Management also uses these measures as a method of comparing cash generation potential with that of many of its competitors. The financial and operating metrics which affect EBITDA include the key revenue and expense drivers for which management is responsible and upon which we evaluate performance.

We believe EBITDA Service Margin (EBITDA as a percentage of service revenues) to be a more relevant measure than EBITDA Margin (EBITDA as a percentage of total revenue) for our Mobility business unit operating margin. We also use wireless service revenues to calculate margin to facilitate comparison, both internally and externally with our wireless competitors, as they calculate their margins using wireless service revenues as well.

There are material limitations to using these non-GAAP financial measures. EBITDA, EBITDA margin and EBITDA service margin, as we have defined them, may not be comparable to similarly titled measures reported by other companies. Furthermore, these performance measures do not take into account certain significant items, including depreciation and amortization, interest expense, tax expense and equity in net income (loss) of affiliates. For market comparability, management analyzes performance measures that are similar in nature to EBITDA as we present it, and considering the economic effect of the excluded expense items independently as well as in connection with its analysis of net income as calculated in accordance with GAAP. EBITDA, EBITDA margin and EBITDA service margin should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP.

EBITDA and Adjusted EBITDA
Dollars in millions
	First Quarter
		2025		2024
Net Income		$	4,692	$	3,751
Additions:
Income Tax Expense		1,299		1,118
Interest Expense		1,658		1,724
Equity in Net (Income) of Affiliates		(1,440)		(295)
Other (Income) Expense - Net		(455)		(451)
Depreciation and amortization		5,190		5,047
EBITDA		10,944		10,894
Transaction, legal and other costs		79		32
Benefit-related (gain) loss		6		(39)
Asset impairments and abandonments and restructuring		504		159
Adjusted EBITDA1		$	11,533	$	11,046
1See "Adjusting Items" section for additional discussion and reconciliation of adjusted items.
Segment and Business Unit EBITDA, EBITDA Margin and EBITDA Service Margin
---
Dollars in millions
	First Quarter
		2025			2024
Communications Segment
Operating Income		$	6,991		$	6,745
Add: Depreciation and amortization		4,973			4,730
EBITDA		$	11,964		$	11,475
Total Operating Revenues		$	29,560		$	28,857
Operating Income Margin		23.7		%	23.4		%
EBITDA Margin		40.5		%	39.8		%
Mobility
Operating Income		$	6,740		$	6,468
Add: Depreciation and amortization		2,526			2,487
EBITDA		$	9,266		$	8,955
Total Operating Revenues		$	21,570		$	20,594
Service Revenues		16,651			15,994
Operating Income Margin		31.2		%	31.4		%
EBITDA Margin		43.0		%	43.5		%
EBITDA Service Margin		55.6		%	56.0		%
Business Wireline
Operating Income (Loss)		$	(98)		$	64
Add: Depreciation and amortization		1,498			1,362
EBITDA		$	1,400		$	1,426
Total Operating Revenues		$	4,468		$	4,913
Operating Income Margin		(2.2)		%	1.3		%
EBITDA Margin		31.3		%	29.0		%
Consumer Wireline
Operating Income		$	349		$	213
Add: Depreciation and amortization		949			881
EBITDA		$	1,298		$	1,094
Total Operating Revenues		$	3,522		$	3,350
Operating Income Margin		9.9		%	6.4		%
EBITDA Margin		36.9		%	32.7		%
Latin America Segment
Operating Income		$	43		$	3
Add: Depreciation and amortization		150			177
EBITDA		$	193		$	180
Total Operating Revenues		$	971		$	1,063
Operating Income Margin		4.4		%	0.3		%
EBITDA Margin		19.9		%	16.9		%

Adjusting Items

Adjusting items include revenues and costs we consider non-operational in nature, including items arising from asset acquisitions or dispositions, including the amortization of intangible assets. While the expense associated with the amortization of certain wireless licenses and customer lists is excluded, the revenue of the acquired companies is reflected in the measure and that those assets contribute to revenue generation. We also adjust for net actuarial gains or losses associated with our pension and postemployment benefit plans due to the often-significant impact on our results (we immediately recognize this gain or loss in the income statement, pursuant to our accounting policy for the recognition of actuarial gains and losses). Consequently, our adjusted results reflect an expected return on plan assets rather than the actual return on plan assets, as included in the GAAP measure of income.

The tax impact of adjusting items is calculated using the adjusted effective tax rate during the quarter except for adjustments that, given their magnitude, can drive a change in the effective tax rate, in these cases we use the actual tax expense or combined marginal rate of approximately 25%.

Adjusting Items
Dollars in millions
	First Quarter
		2025		2024
Operating Expenses
Transaction, legal and other costs1		$	79	$	32
Benefit-related (gain) loss		6		(39)
Asset impairments and abandonments and restructuring		504		159
Adjustments to Operations and Support Expenses		589		152
Amortization of intangible assets		9		15
Adjustments to Operating Expenses		598		167
Other
Equity in net income of DIRECTV		(1,423)		(324)
Benefit-related (gain) loss, impairments of investments and other		64		254
Adjustments to Income Before Income Taxes		(761)		97
Tax impact of adjustments		(165)		22
Adjustments to Net Income		(596)		75
Preferred stock redemption gain		(90)		—
Adjustments to Net Income Attributable to Common Stock		(686)		75
1Includes costs associated with legacy legal matters and the expected resolution of certain litigation associated with cyberattacks disclosed in 2024, which is presented net of expected insurance recoveries.

Adjusted Operating Income, Adjusted Operating Income Margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA service margin and Adjusted diluted EPS are non-GAAP financial measures calculated by excluding from operating revenues, operating expenses, other income (expense) and income tax expense, certain significant items that are non-operational or non-recurring in nature, including dispositions and merger integration and transaction costs, actuarial gains and losses, significant abandonments and impairments, benefit-related gains and losses, employee separation and other material gains and losses. Management believes that these measures provide relevant and useful information to investors and other users of our financial data in evaluating the effectiveness of our operations and underlying business trends.

Adjusted Operating Income, Adjusted Operating Income Margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA service margin and Adjusted diluted EPS should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP. AT&T's calculation of Adjusted items, as presented, may differ from similarly titled measures reported by other companies.

Adjusted Operating Income, Adjusted Operating Income Margin,<br><br>Adjusted EBITDA and Adjusted EBITDA Margin
Dollars in millions
	First Quarter
		2025			2024
Operating Income		$	5,754		$	5,847
Adjustments to Operating Expenses		598			167
Adjusted Operating Income		$	6,352		$	6,014
EBITDA		$	10,944		$	10,894
Adjustments to Operations and Support Expenses		589			152
Adjusted EBITDA		$	11,533		$	11,046
Total Operating Revenues		$	30,626		$	30,028
Operating Income Margin		18.8		%	19.5		%
Adjusted Operating Income Margin		20.7		%	20.0		%
Adjusted EBITDA Margin		37.7		%	36.8		%
Adjusted Diluted EPS
---
	First Quarter
		2025			2024
Diluted Earnings Per Share (EPS)		$	0.61		$	0.47
Equity in net income of DIRECTV		(0.15)			(0.03)
Restructuring and impairments		0.05			0.06
Benefit-related, transaction, legal and other items		—			(0.02)
Adjusted EPS		$	0.51		$	0.48
Year-over-year growth - Adjusted		6.3		%
Weighted Average Common Shares Outstanding with<br><br>Dilution (000,000)		7,223			7,193

Net Debt to Adjusted EBITDA

Net Debt to EBITDA ratios are non-GAAP financial measures frequently used by investors and credit rating agencies and management believes these measures provide relevant and useful information to investors and other users of our financial data. Our Net Debt to Adjusted EBITDA ratio is calculated by dividing the Net Debt by the sum of the most recent four quarters Adjusted EBITDA. Net Debt is calculated by subtracting cash and cash equivalents and deposits at financial institutions that are greater than 90 days (e.g., certificates of deposit and time deposits), from the sum of debt maturing within one year and long-term debt.

Net Debt to Adjusted EBITDA - 2025
Dollars in millions
	Three Months Ended
	June 30,		Sept. 30,		Dec. 31,		March 31,		Four Quarters
	20241		20241		20241		2025
Adjusted EBITDA	$	11,337	$	11,586	$	10,791	$	11,533	$	45,247
End-of-period current debt									8,902
End-of-period long-term debt									117,259
Total End-of-Period Debt									126,161
Less: Cash and Cash Equivalents									6,885
Less: Time Deposits									150
Net Debt Balance									119,126
Annualized Net Debt to Adjusted EBITDA Ratio									2.63
1As reported in AT&T's Form 8-K filed January 27, 2025.
Net Debt to Adjusted EBITDA - 2024
---	---	---	---	---	---	---	---	---
Dollars in millions
	Three Months Ended
	June 30,		Sept. 30,		Dec. 31,		March 31,		Four Quarters
	20231		20231		20231		20241
Adjusted EBITDA	$	11,053	$	11,203	$	10,555	$	11,046	$	43,857
End-of-period current debt									7,060
End-of-period long-term debt									125,704
Total End-of-Period Debt									132,764
Less: Cash and Cash Equivalents									3,520
Less: Time Deposits									500
Net Debt Balance									128,744
Annualized Net Debt to Adjusted EBITDA Ratio									2.94
1As reported in AT&T's Form 8-K filed January 27, 2025.

Supplemental Operational Measures

As a supplemental presentation to our Communications segment operating results, we are providing a view of our AT&T Business Solutions results which includes both wireless and fixed operations. This combined view presents a complete profile of the entire business customer relationship and underscores the importance of mobile solutions to serving our business customers. Our supplemental presentation of business solutions operations is calculated by combining our Mobility and Business Wireline operating units, and then adjusting to remove non-business operations. The following table presents a reconciliation of our supplemental Business Solutions results. Prior period amounts have been conformed to the current period’s presentation.

Supplemental Operational Measures
	First Quarter
	March 31, 2025									March 31, 2024
	Mobility		Business<br>Wireline		Adj.1		Business<br>Solutions			Mobility		Business<br>Wireline		Adj.1		Business<br>Solutions			Percent<br><br>Change
Operating Revenues
Wireless service	$	16,651	$	—	$	(14,202)	$	2,449		$	15,994	$	—	$	(13,608)	$	2,386		2.6	%
Legacy and other transitional services	—		2,475		—		2,475			—		2,997		—		2,997			(17.4)	%
Fiber and advanced connectivity services	—		1,780		—		1,780			—		1,703		—		1,703			4.5	%
Wireless equipment	4,919		—		(4,136)		783			4,600		—		(3,834)		766			2.2	%
Wireline equipment	—		213		—		213			—		213		—		213			—	%
Total Operating Revenues	21,570		4,468		(18,338)		7,700			20,594		4,913		(17,442)		8,065			(4.5)	%
Operating Expenses
Operations and support	12,304		3,068		(10,106)		5,266			11,639		3,487		(9,526)		5,600			(6.0)	%
EBITDA	9,266		1,400		(8,232)		2,434			8,955		1,426		(7,916)		2,465			(1.3)	%
Depreciation and amortization	2,526		1,498		(2,062)		1,962			2,487		1,362		(2,033)		1,816			8.0	%
Total Operating Expenses	14,830		4,566		(12,168)		7,228			14,126		4,849		(11,559)		7,416			(2.5)	%
Operating Income (Loss)	$	6,740	$	(98)	$	(6,170)	$	472		$	6,468	$	64	$	(5,883)	$	649		(27.3)	%
Operating Income Margin							6.1		%							8.0		%	(190)	BP
1Non-business wireless reported in the Communications segment under the Mobility business unit.