Episode summary
AT&T Shares Tumble After Profit Forecast Disappoints Market | Bloomberg Intelligence
Bloomberg Intelligence
· · Hosts: Paul Sweeney, Isabelle Lee · Guests: John Butler, Lindsay Dutch, Jody Lurie, Anurag Rana
Summary
AT&T’s second quarter was described as steady rather than flashy, but the market focused on a softer profit outlook and a few operational pressure points. A telecom analyst said churn ticked higher, competition remains intense, and AT&T is choosing to reinvest tax savings into 5G and mid-band spectrum rather than lift guidance. He also said fiber remained healthy even though net additions missed expectations.
Hasbro’s quarter was strong on the surface, with momentum from Magic: The Gathering, Monopoly Go and digital gaming, but a consumer hardlines analyst said the bigger question is the second half. Retailers paused holiday ordering amid tariff uncertainty, the company faces higher costs on toys, and management is using a mix of price increases, cost cuts and selective product pullbacks to protect margins.
Hilton cut its 2025 net income expectations, but a credit analyst said the company remained upbeat on travel trends and is still seeing strength in summer demand. The more important theme was geographic diversification, with Hilton looking beyond the US for growth. On the technology side, a senior analyst said Microsoft’s SharePoint breach is unlikely to hit the stock much, while cloud and AI demand remain the bigger story, especially for Microsoft, AWS, Google and Oracle.
Key takeaways
- The telecom analyst said AT&T’s quarter was “relatively unremarkable,” but that is a positive in a highly competitive wireless market.
- AT&T is reinvesting tax savings into 5G and mid-band spectrum instead of boosting guidance, according to the analyst.
- Hasbro’s strength is still coming from Magic: The Gathering, Monopoly Go and digital gaming, but holiday ordering delays cloud the toy outlook.
- The consumer hardlines analyst said Hasbro expects tariffs to pressure costs and is using selective price increases and cost cuts to offset them.
- Hilton is lowering 2025 net income expectations, but the credit analyst said the company is still upbeat on summer demand and looking for growth outside the US.
- A technology analyst said Microsoft’s security breach is bigger as a headline than as a stock catalyst, while AI and cloud remain the main growth drivers.
Notable quotes
“I would say it was a relatively unremarkable quarter. And in telecom, that's a very good thing”
“they're taking all the savings in. They're driving it back into upgrading the 5G network, which they've been doing”
“the strength is really coming from Magic the Gathering, Monopoly Go, and Hasbro's digital gaming business”
“they will be raising prices, I think, selectively on toys”
How the episode opens
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AT&T reported some numbers there. Some pretty big numbers in subscribers. I noted uh stock's kind of flat today, but it's up 20% year to date. Let's break it down with John Butler, uh Bloomberg Intelligence, senior telecom analyst and the pride of Lafayette College uh out there. John, uh talk to us about AT&T. That's a competitive business they're in. What did they deliver?
Boy, it is a tough business, Paul. And I'll tell you what, as quarters go for AT&T, I would say it was a relatively unremarkable quarter. And in telecom, that's a very good thing.
I mean, I seem to to just say a quarter in and quarter out, but AT&T is the steady hand in the space here. I mean, they just have done a great job of setting a foundation for a very good business and just executing on that plan. They do a quarter and and quarter out and 2Q was no exception here.
What are you expecting? Like how are SA TNT and specific metrics like cash flow or net ads really playing out compared to its competitors in this space? I feel like the network space is really very challenging because as Paul and I talked about, it's so easy to move, especially these days when you can keep your cell phone number.
Yeah. I mean, what you're talking about is switching activity. And if there was anything this quarter that sort of caught my eye, it was the churn number. And by the way, I wasn't alone.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- att earnings
- consumer hardlines earnings
- credit outlook hotel demand
- microsoft sharepoint hack
- wireless subscriber growth
Companies and tickers mentioned
- T
- HAS
- HLT
- MSFT
- AT&T
- Hasbro
- Hilton Worldwide Holdings
- Microsoft
- Eye Security
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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