Key Highlights

  • AT&T (NYSE:T) reported GAAP diluted earnings of USD 0.13 per share on Wednesday, October 21, 2026, after a USD 2.6 billion non-cash impairment on its Mexico wireless business, against adjusted EPS of USD 0.65.
  • The Mexico charge cost USD 0.41 per share, employee separation costs USD 0.09 and other items USD 0.02, according to the company's reconciliation of reported to adjusted earnings.
  • AT&T agreed on Tuesday, October 13, 2026 to sell Mexico wireless, with the outlook naming Grupo Televisa and Fintech Holdings as buyers, while Latin America revenue still rose 13.2% to USD 1.24 billion.
  • Net debt reached USD 149.8 billion after the EchoStar spectrum closing, lifting net debt to adjusted EBITDA to 3.13 times, while the company bought back USD 2.8 billion of stock in the quarter.

Two Earnings Lines and One Sale

AT&T (NYSE:T), the US wireless and fibre carrier, reported third-quarter results at 6:30 a.m. ET on Wednesday, October 21, 2026. Adjusted EPS was USD 0.65, against the consensus estimate of USD 0.60 and USD 0.54 a year earlier. GAAP diluted earnings from continuing operations were USD 0.13, against USD 1.29. Both comparisons carry one-offs. This quarter, a USD 2.6 billion non-cash impairment tied to the agreed sale of Mexico wireless reduced earnings by USD 0.41 per share. A year earlier, a gain on the DIRECTV sale added USD 0.79. GAAP operating income fell to USD 4.1 billion from USD 6.1 billion, while adjusted operating income rose to USD 7.6 billion from USD 6.6 billion. Revenue rose 5.3% to USD 32.3 billion.

How a Write-Down Differs From a Cash Loss

For AT&T (NYSE:T), the impairment is an accounting write-down of the book value of Mexico wireless, recorded as the company agreed to sell it, and it uses no cash. Free cash flow therefore held at USD 5.0 billion, against USD 4.9 billion a year earlier, on cash from operations of USD 10.5 billion. The sale fits a portfolio narrowing towards US fibre and wireless: fibre net additions were 442,000, and Advanced Home Internet revenue rose 23.4% to USD 2.98 billion. The balance sheet is the pressure point. Net debt rose to USD 149.8 billion after the EchoStar spectrum closing, and leverage reached 3.13 times adjusted EBITDA, against 2.59 times in the company's 2025 comparison. Buybacks of USD 2.8 billion continued alongside USD 1.95 billion of dividends.

Risks and What to Watch

The first risk for AT&T (NYSE:T) is execution on the Mexico sale, since the release gives no closing date and terms could change before completion. The second is leverage: at 3.13 times adjusted EBITDA, debt reduction competes with plans to buy back about USD 10 billion of stock in 2026 and more than USD 24 billion over 2026 to 2028. The third is the shrinking legacy base, where revenue fell 24.5% to USD 1.5 billion and EBITDA fell 26.7%. Investors should watch progress on the Mexico sale and on the sale of a controlling stake in the Forged Fiber 37 network assets, free cash flow against the 2026 goal of more than USD 18 billion and adjusted EPS against about USD 2.40.

Where Things Stand

The answer is that the USD 2.6 billion Mexico charge cut reported earnings but not cash, so it matters mainly as a sign that AT&T (NYSE:T) is narrowing its footprint. Adjusted EPS of USD 0.65 beat the consensus estimate of USD 0.60, and free cash flow reached USD 5.0 billion. Leverage of 3.13 times after the spectrum deal is the figure to track. The next catalysts are the Mexico closing, the fibre asset sale and fourth-quarter cash flow. Outlooks are company forecasts, not guarantees, and this is not investment advice.