AT&T and Corning have taken a significant step in their long-standing partnership by signing a multi-year, $1 billion agreement for fiber products. This deal positions AT&T as Corning’s largest customer, granting it preferential status for fiber purchases. The products, including Corning’s Evolv™ FlexNAP, adhere to the Broadband Equity, Access, and Deployment (BEAD) program requirements, supporting domestic manufacturing.
Corning is proactively expanding operations in Monroe County, New York, with a $139 million investment to meet the growing fiber demand. This venture aligns with AT&T’s strategy to enhance its fiber and 5G services. John Stankey, AT&T’s CEO, emphasized the importance of this agreement for connecting households, businesses, and communities with reliable, high-speed internet.
Wendell Weeks, Corning’s Chairman and CEO, remarked on the shared vision of connecting more people through fiber, which is proving vital as data needs escalate. The partnership aims to leverage Corning’s expertise to deliver high-speed connections more widely.
The fiber strategy’s importance was highlighted during AT&T’s recent third-quarter investor call. Stankey noted strong customer demand, leading to consistent consumer fiber net additions for 19 consecutive quarters. He underscored that this investment generates attractive returns by improving operating leverage while transitioning from legacy networks.
Interestingly, AT&T’s fiber growth is intertwined with its mobile business. Customers increasingly opt for converged services, combining mobility and broadband. This integration, unique to AT&T, enhances market penetration and drives growth across its offerings.
From a financial perspective, owning and operating both fiber and 5G networks enables AT&T to capture a greater share of mobility and broadband markets. Stankey indicated that four out of every ten AT&T Fiber households are also wireless customers, highlighting the cross-selling potential.
The expansion of their fiber footprint is not limited to AT&T’s networks alone. Through ventures like Gigapower with BlackRock, AT&T extends its fiber offerings outside its proprietary infrastructure.
As AT&T aims to pass 30 million locations with fiber by 2025, it’s considering increasing this target by an additional 10-15 million locations. This expansion reflects better-than-expected returns on fiber investments.
