American telecom service provider AT&T is likely to maintain Capex (capital spending) in 2014 at around $21 billion as compared with $21.2 billion it invested in 2013.
The flat growth in Capex may not be good news for telecom equipment vendors such as NSN, Huawei, ZTE, Ericsson, Alcatel-Lucent, Cisco, Samsung, etc.
However, AT&T will be on track to deliver the financial targets laid out with Project VIP, the mobile operator said on Tuesday.
In 2013, AT&T increased its Capex to $21.2 billion from $19.7 billion in 2012, as AT&T began its Project Velocity IP (Project VIP) build.
As part of its Project VIP-related LTE 4G deployment, the company now covers nearly 280 million POPs. The company’s LTE deployment is expected to be substantially complete by this summer, said AT&T in a statement.
AT&T chairman and CEO Randall Stephenson said: “2013 was the year of the network. With Project VIP, we’re delivering faster speeds and new services to millions more customers. 4G LTE network is nearly complete and is the nation’s most reliable with lightning-fast speeds. U-verse is rapidly expanding, and our fiber-to-the-business build is off to a fast start.”
AT&T started Project Agile, a new initiative to streamline and improve business. Execution has begun and will be a focus area for AT&T in 2014 and beyond.
The American company believes that AT&T has good momentum in areas like connected car, home automation and mobile business solutions.
For the quarter ended December 31, 2013, AT&T’s consolidated revenues rose 1.8 percent to $33.2 billion. AT&T’s net income grew to $6.9 billion in Q4 against net loss of $3.9 billion in the year-earlier quarter.
AT&T’s revenues in 2013 rose marginally to $128.8 billion from $127.4 billion. Net income in 2013 grew to $18.2 billion from $7.3 billion.
Meanwhile, AT&T chief executive officer Randall Stephenson met with several European officials last week to discuss the U.S. spying scandal, which is affecting the telecom company’s business.
“We’ve had some business impacts from the NSA,” he told investors during the company’s quarterly earnings call. “It’s affecting our ongoing business today irrespective of anything that might relate to M&A.”
