Earnings and Revenue Estimates

According to a FactSet poll of analysts, AT&T is projected to report earnings of 60 cents per share on revenue of $29.96 billion for the second quarter. In comparison, the company reported earnings of 65 cents per share on revenue of $29.64 billion in the same period last year.

The Impact of Lead-Sheathed Cable Liability

One factor that may have a greater impact on AT&T’s share performance is any commentary regarding its liability for lead-sheathed cables. The Wall Street Journal recently highlighted the presence of thousands of miles of copper cables wrapped in lead still in use across America, resulting in significant lead contamination levels in the surrounding environment.

Following this report, AT&T’s stock experienced a significant drop, reaching a 30-year low. Concerns were raised that the company would bear the cost of removing the cables it owns, as well as potential legal action regarding the associated environmental and health risks. However, the stock has since recovered partially as analysts adjusted their estimates for potential costs.

AT&T has stated that less than 10% of their 2 million miles of copper cabling are sheathed in lead. Moreover, over two-thirds of the lead-sheathed cables are buried in conduits, while the remainder are overhead cables.

Will There Be Any Updates?

While AT&T awaits their second-quarter earnings announcement, rival telecoms company Verizon Communications (VZ) has stated that it is too early to estimate any costs related to lead-wrapped cables as they are still conducting their own tests.

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