AT&T said this week that it expects its revenue and earnings to grow through 2018 after it purchased DirecTV and investments in Mexico. However the company said it does expect higher capital expenditure as a result.
Since US mobile market has almost reached saturation, AT&T aims to utilise DirecTV’s video assets and has since been expanding wireless operations in Mexico to boost revenue.
AT&T raises expectations after DirecTV buy
AT&T closed the $48.5 billion purchase of DirecTV in July and plans to deliver video through ad-supported streaming to TV and mobile video products.
The number 2 mobile operator said in a statement that revenue is expected to grow in the double-digit range for the remainder of this year. The company, which forecast capital expenditure of $18 billion says it expects that to rise to $21 billion.
AT&T forecast 2015 adjusted profit of $2.62 per share to $2.68 per share. Analysts were expecting a profit of $2.60 per share on average.
“In bringing together AT&T and DirecTV we’ve articulated a simple goal, the development of a premium, effortless entertainment experience delivered anywhere”, said chief executive Randall Stephenson on a conference call.
AT&T has bundles mobile services with DirecTV’s pay TV services to cross sell across its entire customer base. The new packages were released on Monday and have apparently exceeded sales expectations.
The company maintained its forecast of $2.5 billion in cost savings from the DirecTV deal on a yearly basis through to 2018.
Larry Banks is a keen follower of technology and finance. He has worked for a variety of online publications, writing about a diverse range of topics including mobile networks, patents, and Internet video delivery technologies.