Telecommunications conglomerate AT&T (NYSE: T) fell short of the market’s revenue expectations in Q2 CY2026 as sales rose 2.3% year on year to $31.56 billion. Its GAAP profit of $0.66 per share was 11.2% above analysts’ consensus estimates.
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AT&T (T) Q2 CY2026 Highlights:
- Revenue: $31.56 billion vs analyst estimates of $31.75 billion (2.3% year-on-year growth, 0.6% miss)
- EPS (GAAP): $0.66 vs analyst estimates of $0.59 (11.2% beat)
- Operating Margin: 23.3%, up from 21.1% in the same quarter last year
- Free Cash Flow Margin: 16.2%, similar to the same quarter last year
- Market Capitalization: $154.7 billion
Company Overview
Founded by Alexander Graham Bell, AT&T (NYSE: T) is a multinational telecomm conglomerate providing a range of communications and internet services.
Revenue Growth
A company’s long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Unfortunately, AT&T struggled to consistently increase demand as its $127.2 billion of sales for the trailing 12 months was close to its revenue five years ago. This was below our standards and is a sign of poor business quality.
We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new product or trend. AT&T’s annualized revenue growth of 2% over the last two years is above its five-year trend, which is encouraging. 
This quarter, AT&T’s revenue grew by 2.3% year on year to $31.56 billion, falling short of Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 3.1% over the next 12 months, similar to its two-year rate. While this projection indicates its newer products and services will spur better top-line performance, it is still below average for the sector.
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Operating Margin
AT&T’s operating margin has risen over the last 12 months and averaged 18.2% over the last two years. The company’s higher efficiency is a breath of fresh air, but its suboptimal cost structure means it still sports inadequate profitability for a consumer discretionary business.
This quarter, AT&T generated an operating margin profit margin of 23.3%, up 2.2 percentage points year on year. This increase was a welcome development and shows it was more efficient.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
AT&T’s full-year EPS flipped from negative to positive over the last five years. This is encouraging and shows it’s at a critical moment in its life.
In Q2, AT&T reported EPS of $0.66, up from $0.62 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects AT&T’s full-year EPS to shrink by 20.1% from $3.04 to $2.43.
Key Takeaways from AT&T’s Q2 Results
It was good to see AT&T beat analysts’ EPS expectations this quarter. On the other hand, its revenue slightly missed. Overall, this print had some key positives. The stock traded up 2.6% to $22.84 immediately following the results.
Is AT&T an attractive investment opportunity right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).
