AT&T
will offer customers affected by a spate of service outages last week a $5 credit as compensation, the telecommunications company’s CEO said.
Thousands of AT&T customers reported service issues last Thursday, including problems making and receiving calls. The company said that an initial review showed that the outages happened because an incorrect process was used in expanding its network, rather than because of a cyberattack.
Outages began early Thursday, with about three-quarters of customers still able to access the network and the remaining customers reconnected through the morning, AT&T said. The network was back to normal by around noon.
“No matter the timing, one thing is clear – we let down many of our customers, including many of you and your families. For that, we apologize,” CEO John Stankey said in a statement on Sunday.
AT&T is automatically applying a credit to the accounts of consumers and small businesses most affected by the outage, Stankey said, adding that prepaid customers will have options available to them. On its website, AT&T said that customers were eligible for one $5 credit per AT&T Wireless account.
“We issue bills every day, so customers will see the credit in 1-2 bill cycles depending on when their bill closes,” AT&T said. “Most credits will be posted in the next billing cycle.”
“I believe that crediting those customers for essentially a full day of service is the right thing to do,” Stankey said. “Despite that impact to the business, I believe this approach is fully manageable while achieving the 2024 business objectives we have set for ourselves and our stated financial guidance.”
Speaking to Barron’s at Mobile World Conference in Barcelona on Monday, Chris Sambar, president of AT&T Network, declined to comment on the number of people likely to receive compensation or how big an expenditure it would be for the company. He noted some customers might have “unique circumstances” that could affect the credit received and that AT&T would deal with those as they came up.
When AT&T filed quarterly earnings last month, it said it expected adjusted earnings in fiscal 2024 of between $2.15 and $2.25 a share, which at the time was below Wall Street estimates of $2.46.
AT&T stock was up 0.1% in premarket trading Monday, while
Verizon Communications
was flat,
T-Mobile
gained 0.2%, and the
S&P 500
was off 0.1%.
Write to Jack Denton at jack.denton@barrons.com
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