Adjusted EPS, which also includes a 10-cent a share loss on pension plan valuations, reached USD 0.66, up slightly from USD 0.63 a year earlier. AT&T also increased free cash flow (operating cash flow minus capex) by 19.2 percent to USD 3.7 billion.
Over the full year, revenues were up 11.6 percent, thanks to a full year consolidating DirecTV, while profits were down slightly due to the additional costs. AT&T said it aims to return to low single-digit revenue growth in 2017, excluding the pending acquisition of Time Warner or other deals. Adjusted EPS is expected to again grow in mid single digits, and the adjusted operating margin is also forecast to improve further this year. Capex is forecast stable at around USD 22 billion, and free cash flow is expected to grow to USD 18 billion from USD 16.9 billion in 2016.
The company's operational results showed a continued deterioration in the consumer mobile market, with just 8,000 net adds in the quarter, as customer losses at resellers offset growth under its own brand. This was offset by 1.51 million new connections in the business market, of which 1.26 million were non-phone devices. Churn in the consumer market increased to 2.43 percent from 1.97 percent a year ago.
The performance was little better in the fixed market, although the company returned to net growth of 3,000 consumer broadband subscribers, after two quarters of losses. Growth in fibre subscribers just offset DSL losses. In the video segment, DirecTV added 235,000 new customers, while the U-verse IPTV service lost another 262,000. Video ARPU, excluding the new DirecTV Now streaming service, was up at USD 125.25 compared to USD 120.59 a year ago. AT&T said it had signed up over 200,000 customers for the streaming service.
