Goldman Sachs sees AT&T's fiber-led convergence strategy supporting growth, with a $30 target.

Overview

This conference-takeaways report summarizes AT&T management's case for fiber-led convergence, renewed business-connectivity growth, and targeted exposure to data-center interconnect demand. Goldman Sachs remains Buy rated, using a $30 12-month target based on 6.5x NTM+1Y EBITDA.

Core views

AT&T presented fiber-led convergence—combining wireless and broadband—as its core strategic advantage. Management believes the industry remains in the early stages of convergence and expects future value creation to move beyond bundled discounts toward integrated products, features, and more seamless connectivity experiences. AT&T's converged offering has already produced share gains and, according to management, higher household revenue, better margins, lower churn, and manageable acquisition costs. Although convergence is creating near-term ARPU pressure, management expects the resulting customer lifetime value to be accretive over time. Longer term, it sees opportunities to differentiate the service through features such as satellite coverage and security. The company also highlighted its ability to address underpenetrated customer groups. AT&T reported its best new-account growth in roughly three years in the prior quarter, attributing the improvement to reaching new customer cohorts. Its recently launched Build-A-Plan targets the value segment, where management said AT&T has historically been underpenetrated. Management argued that the broader convergence model can extend to this segment through offerings that include affordable broadband. In the business segment, AT&T reported 2% year-on-year growth in advanced connectivity service revenue in 2Q26, following a period of idiosyncratic headwinds that had produced flat to negative growth. Management attributed the return to growth to placing fiber in the right locations, using more alternative distribution channels, and improving incentive alignment. The next product step is intended to let customers actively manage their networks across all layers while retaining service quality and security. AT&T is participating selectively in the data-center interconnect build-out, concentrating on routes it already needed to construct and seeking a footprint through which clients can place traffic into any cloud provider. Management also expects AI applications to increase uplink traffic requirements on the wireless network. It said the 600 MHz spectrum acquired from EchoStar should support stronger uplink capacity and use cases including robotics and upstream video processing. Goldman Sachs states that AT&T reiterated its existing financial outlook and capital-allocation plan. The firm remains Buy rated with a 12-month $30 target price, versus a $25.15 price as of the 9 September 2026 close, implying 19.3% upside. Its valuation uses a 6.5x NTM+1Y EBITDA multiple. The report's forecast table shows revenue rising from $125,648.0 million in 2025 to $136,754.2 million in 2028E, EBITDA from $46,361.0 million to $54,474.4 million, and EPS from $2.12 to $3.18; projected EV/EBITDA declines from 7.0x in 2025 to 5.6x in 2028E.

Analysis framework

Goldman Sachs organizes the conference discussion around management's strategic and operating messages: the benefits of fiber-wireless convergence, expansion into underpenetrated customer groups, recovery in business connectivity, and AI-related network and interconnect demand. It supports the investment view with reported 2Q26 business revenue growth, management commentary, forward financial estimates, and an EBITDA-multiple valuation.

Methodology notes

• Valuation methodsEV/EBITDA valuation

  NTM+1Y EBITDA multiple valuation

  Goldman Sachs derives its $30 12-month target price using a 6.5x multiple of next-twelve-month-plus-one-year EBITDA.

• Competition & strategyEconomic Moat and Competitive Advantage

  Fiber-led wireless and broadband convergence

  The report treats converged connectivity as a competitive advantage because it is intended to support share gains, household revenue, margins, retention, and customer lifetime value.

• Industry AnalysisUpstream-Midstream-Downstream Transmission

  AI-driven data-center interconnect and uplink traffic demand

  The report links AI infrastructure activity to data-center interconnect routes and greater wireless uplink requirements, which AT&T is positioning its network and spectrum to address.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• AT&T Inc. (T)

  Primary covered company; the report links its upside case to fiber-led convergence, business-connectivity improvement, and selective data-center interconnect participation.

  Strengths

  Converged wireless-plus-broadband offering, recent account growth, improving business advanced connectivity growth, and 600 MHz spectrum intended to support uplink demand.

  Weaknesses

  Near-term ARPU pressure from convergence and prior idiosyncratic headwinds in business connectivity.

  Comparison

  Management characterizes AT&T as seeking scaled fiber-provider status to strengthen its wireless business.

  Risks

  New fiber competitors, tougher consumer wireless competition, limited spectrum availability and lack of US spectrum auctions, and faster-than-expected business-wireline deterioration.

Key data

• 2Q26 business advanced connectivity service revenue growth+2% yoyGrowth resumed after a period of flat to negative performance.
• 12-month price target$30.00Based on 6.5x NTM+1Y EBITDA.
• Share price$25.15Price as of 9 September 2026 close.
• Implied upside19.3%Difference between the stated price and 12-month target.
• Revenue forecast$125,648.0mn in 2025 to $136,754.2mn in 2028EGoldman Sachs forecast.
• EBITDA forecast$46,361.0mn in 2025 to $54,474.4mn in 2028EGoldman Sachs forecast.
• EPS forecast$2.12 in 2025 to $3.18 in 2028EGoldman Sachs forecast.
• EV/EBITDA7.0x in 2025 to 5.6x in 2028EForecast valuation multiple progression.

Impact & implications

The report argues that sustained execution in fiber-led convergence can turn short-term ARPU pressure into improved lifetime customer economics, while business-product improvements and targeted AI-network investment offer additional growth avenues. The valuation case depends on AT&T delivering these operating improvements while maintaining its outlook and capital-allocation plan.

Risks

• New fiber competitors in AT&T expansion markets could materially reduce penetration rates.
• More intense consumer wireless competition could weaken revenue and margins relative to expectations.
• Limited spectrum availability and the absence of US spectrum auctions could reduce growth expectations.
• AT&T's business-wireline franchise could deteriorate faster than Goldman Sachs expects.

What to watch

• Whether convergence continues to generate share gains, higher household revenue, lower churn, and improved customer lifetime value despite near-term ARPU pressure.
• Progress in reaching underpenetrated value-segment customers through Build-A-Plan and affordable broadband offerings.
• Sustainability of growth in business advanced connectivity services following the 2% year-on-year increase in 2Q26.
• Execution of selective data-center interconnect projects and the effect of AI-related uplink traffic on network investment and spectrum utilization.