AT&T has reported a robust addition of 294,000 net new postpaid phone subscribers in the first quarter, surpassing Wall Street expectations of 272,000. This increase is vital as it indicates the carrier's ability to attract and maintain these profitable customers, which constitute a significant part of its subscriber base.

The churn rate, which reflects the percentage of subscribers leaving the service, showed a marginal uptick. AT&T's postpaid phone churn rate stood at 0.89%, a notable decrease from the previous quarter's 0.98%. However, this figure remained unchanged from last year's rate of 0.87% in Q1 2025.

Furthermore, AT&T is seeing success in customer bundling, with 42% of its home internet customers also subscribing to its wireless services.

To optimize its Average Revenue Per User (ARPU), AT&T has raised prices on its highest and lowest-tiered plans. For Q1 2026, the postpaid phone ARPU was reported at $55.57, representing a decline from $56.56 in the same period last year.

First quarter revenue increased by 3% to $31.5 billion, exceeding forecasts of $31.25 billion. Earnings per share reached 57 cents, reflecting an 11.8% increase from 51 cents per share year-on-year.

After initially dipping along with T-Mobile and Verizon shares due to speculation surrounding a potential merger, AT&T's stock made an impressive recovery. Rising from a low of $24.96, shares climbed back to $25.86, experiencing only a minor loss as traders attributed the rebound to the company’s positive bundling strategies.

AT&T has also restructured to emphasize its key business units, with the new advanced connectivity segment encompassing 5G and fiber services, contributing to a 5% revenue increase from higher sales of wireless devices.