Listen to this articleAT&T CEO Randall Stephenson introduced his retirement on Friday April 24, efficient July 1, 2020.
“After serving 13 years as AT&T’s Chairman and CEO, Randall Stephenson, 60, will retire as CEO but will serve as Executive Chairman of the Board of Directors until January 2021 to ensure a smooth leadership transition”, the firm posted on its website.
“The AT&T Inc.* (NYSE:T) Board has elected AT&T President and Chief Operating Officer John Stankey as CEO effective July 1, 2020, and a member of the Board of Directors effective June 1, 2020,” the firm added.
AT&T’s inventory value was $39.47 in May 2007 when Randall Stephenson took over as CEO, however the firm now trades below $30, about 24% decrease. The S&P 500 is up about 85% in the similar interval, CNBC reported.
In dividend, AT&T is one of the world’s most dependable dividend payers, and the firm’s dividend has constantly increased since 2007. AT&T pays a quarterly dividend in the present day of $0.52 per share. It was $0.355 again in May 2017. That’s a 46% enhance.
That maybe finest sums up Stephenson’s tenure, which has been notable for its enormous bets on acquisitions which have given AT&T adequate streams of money circulate and potential new income streams away from wi-fi cellphone enterprise. Still, the offers themselves have been disasters at worst and questionable at finest, tarnishing his CEO stint.
“He leaves behind a completely transformed AT&T, but the jury is still out if the transformation is for better or worse,” mentioned Craig Moffett, a telecommunications analyst at MoffettNathanson.
Stephenson can’t be faulted by sitting on his heels and failing to behave. Just the reverse. He’s tried to be extraordinarily aggressive with acquisitions all through his tenure, first making an attempt to purchase wi-fi supplier T-Mobile in 2011 for $39 billion, then pivoting to buy DirecTV for $48.5 billion in 2015, and eventually touchdown his greatest blow by buying Time Warner for $85 billion in a deal that closed in 2018.
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Regulators blocked AT&T’s try to purchase T-Mobile, costing AT&T about $6 billion in money and spectrum as a breakup charge. That cash and AT&T’s transferred wi-fi airwaves helped jump-start T-Mobile right into a extra strong competitor, which then arguably robbed AT&T of tens of millions of prospects in the following years.
AT&T’s acquisition of DirecTV has additionally been a “disaster,” in accordance with Moffett, who estimated DirecTV is value lower than half of the close to $50 billion AT&T paid for it in 2015. AT&T misjudged the tempo of what number of satellite tv for pc TV prospects would ditch their conventional pay-TV service for so-called “over the top” web video choices.
Stephenson and incoming CEO John Stankey have really leaned into this in recent times, together with rolling out AT&T TV this yr, which purposefully eliminates satellite tv for pc set up. AT&T misplaced greater than 4 million prospects from its satellite tv for pc, wireline and linear streaming-TV companies in 2019, from 24.5 million to twenty.4 million. Those losses have continued in 2020, asserting one other 897,000 premium TV subscriber losses in the first quarter of this yr.
Only time will dictate if AT&T’s enormous buy of Time Warner will probably be successful. Stankey has tried to fully revamp WarnerMedia as its CEO since the acquisition’s announcement. Stankey has a grand vision for how AT&T can use HBO Max, WarnerMedia’s new streaming service that launches next month, to bolster its personal wi-fi service and assist increase AT&T’s buying and selling a number of to one thing that appears extra like Netflix’s.
But in the midst of doing this, Stankey has successfully compelled out many leisure leaders at HBO and other WarnerMedia divisions. His imaginative and prescient for HBO Max — “Where HBO Meets So Much More” — dangers diluting the HBO model over time. HBO has stood for high quality programming for many years. And Stankey is now saddled with a legacy TV enterprise which is nearly actually slowly dying as tens of millions of prospects lower the twine on cable TV every year.
Stephenson’s selection of Stankey as his alternative is “an endorsement of the status quo, for better or for worse,” Moffett mentioned. But selecting anybody else would “potentially be catastrophic,” given the unfinished strikes AT&T has already made.
It’s doable Stephenson will probably be seen as a visionary as the years go by if AT&T outperforms its closest competitor, Verizon, who’s planning to spend assets constructing out a high-speed 5G wi-fi community as a substitute of shopping for media belongings. But for now, a minimum of, Stephenson departs with a narrative that’s solely been partially written and a $200 billion debt load that looms ominously over an economic system in dire straits.
“Leadership succession is one of the Board’s most important responsibilities,” AT&T Director Beth Mooney mentioned. “After an in depth analysis, it was clear that John Stankey was the proper particular person to steer AT&T into the future.”
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Stankey, 57, has served as president and COO since October 2019, AT&T posted on its web site. Stankey joined AT&T in 1985 and has greater than 30 years of achieved management spanning practically each space of AT&T’s enterprise, from company technique and expertise, to operations and media and leisure. Stankey has served in a range of roles, together with: CEO of WarnerMedia; CEO of AT&T Entertainment Group; Chief Strategy Officer; Chief Technology Officer; CEO of AT&T Operations; and CEO of AT&T Business Solutions.
