AT&T's Fiber Investment Is Turning Into a Home Run

While the wireless business is the largest contributor to AT's (NYSE: T) revenue by far, the fiber internet business is proving to be a potent growth opportunity. Capturing that growth comes at a cost: Building out a fiber network is capital-intensive, requiring vast outlays with no guarantee that consumers and businesses will sign up for service.

AT operates a vast legacy wireline network that serves consumers and businesses, but that business is in perpetual decline. Even the company's non-fiber broadband service is slowly eroding as subscribers flee. Wireline service revenue from businesses is dropping particularly quickly, down 11% year over year in the fourth quarter of 2023.

AT's fiber internet business is already big enough and growing fast enough to push overall consumer broadband revenue and consumer wireline revenue higher. AT expects broadband revenue to rise by AT least 7% in 2024, more than twice as fast as wireless service revenue growth.

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Source Fool.com