AT&T this week sold $17.5 billion in bonds to help pay for its planned $48.5 billion acquisition of DirecTV, and also raised its target for synergies from the tie-up.
The bond sale took place on Thursday, a day after AT&T posted a solid set of quarterly financial results; revenue and net profit fell, but came in within expectations, and the telco recorded strong mobile customer additions.
"The repositioning of our wireless c ustomer base to no-device-subsidy plans drove industry-leading postpaid churn," said AT&T CEO Randall Stephenson, in a statement.
AT&T added 441,000 postpaid mobile phone customers in Q1, while postpaid churn came in at 1.02%, versus 1.07% in the year-ago quarter. Overall mobile churn was 1.4%.
In total AT&T recorded 1.2 million net customer additions at its wireless business, but close to 1 million of those were connected devices. The telco ended the quarter with a wireless customer base of 121.77 million, including just over 76 million postpaid phone customers and close to 22 million connected devices.
Stephenson also talked up progress at the telco’s wireline business. Fixed voice connections continued to decline, but AT&T saw its broadband base grow by 93,000 to 14.54 million, and added 49,000 U-verse video customers to reach 5.97 million.
"Plus, we established a good foothold in the Mexican wireless market with our acquisition of Iusacell and we are on track to close our acquisition of Nextel’s Mexico operations shortly," Stephenson added.
"This, along with our expectation that we’ll gain final approval of the DirecTV deal in the second quarter, adds to our confidence that we’re on track to be a very different company uniquely positioned for growth," he said.
AT&T said it now expects to realise cost synergies of $2.5 billion on an annual run rate by the third year after the close of the DirecTV deal, up from a previous prediction of $1.6 billion.
It reiterated that it expects to get final approval for the deal in Q2.
