Key Takeaways
- AT&T (T) reported Q2 2026 adjusted EPS of $0.65, beating analyst estimates of $0.59 by over 10%, driven by robust subscriber growth in fiber and wireless segments.
- The telecom giant accelerated its share repurchase program, now targeting approximately $10 billion in buybacks for 2026, signaling strong confidence in its free cash flow and market position.
- Wells Fargo (WFC) lowered its price target for Arm Holdings (ARM) to $350 from $410, citing valuation concerns despite maintaining a positive long-term outlook on AI-driven demand.
- Iran accused the U.S. of "pretext for aggression" following reports of strikes near the Kolang Kouh site, escalating geopolitical tensions in the region.
AT&T Delivers Strong Q2 Results and Boosts Buybacks
AT&T (T) posted a significant earnings beat for the second quarter of 2026, reporting adjusted EPS of $0.65 against a consensus estimate of $0.59. While revenue of $31.6 billion slightly missed the $31.77 billion forecast, the company saw a 2.3% year-over-year increase in total sales. The growth was spearheaded by the Advanced Connectivity segment, where service revenue rose 5.1% and operating income surged 20.3%.
The company added 432,000 wireless postpaid phone net adds, comfortably exceeding the estimated 325,264. Additionally, AT&T (T) reported 367,000 fiber net adds, marking its strongest consumer postpaid account growth in over three years. Management reiterated its full-year guidance, expecting free cash flow of at least $18 billion and adjusted EPS between $2.25 and $2.35.
In a move that cheered investors, CEO John Stankey announced an acceleration of the company's capital return plans. AT&T (T) now intends to repurchase approximately $10 billion of its own shares this year. The market reacted positively to the news, with shares rising nearly 5% in early trading as investors focused on the subscriber momentum and increased shareholder returns.
Wells Fargo Trims Arm Holdings Price Target
Wells Fargo (WFC) adjusted its outlook on Arm Holdings (ARM) on Wednesday, cutting its price target to $350 from $410. The revision comes amid a broader cooling of semiconductor valuations following a massive year-to-date rally. Despite the lower target, the firm remains optimistic about Arm's role as a "compute backbone" for the AI era, particularly with the rollout of its AGI CPU architecture.
Analysts noted that while data center royalty revenue more than doubled in recent quarters, the stock’s premium valuation—trading at over 100x forward earnings—presents a challenging setup for the near term. The adjustment reflects a growing trend among Wall Street analysts to recalibrate expectations for high-flying AI names ahead of the late-July earnings cycle. Arm Holdings (ARM) is currently scheduled to report its next set of financial results on July 29, 2026.
Geopolitical Tensions Escalate Over Iranian Nuclear Sites
Geopolitical risks intensified as Iran issued a stern warning to the United States regarding its focus on the Kolang Kouh region. Iranian officials characterized U.S. interest in the site as a "fabricated pretext for aggression," maintaining that no nuclear activity is occurring there. This follows reports of U.S. strikes on other infrastructure, including the under-construction Darkhovin nuclear power plant.
Tehran has called upon the International Atomic Energy Agency (IAEA) to condemn what it describes as "barbaric acts" and violations of international law. Market participants are closely monitoring these developments, as any further escalation in the Middle East could lead to increased volatility in energy markets and defense-related equities. The Iranian mission to the UN warned that continued "appeasement of aggressors" would only encourage further instability in the region.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.