AT&T warns of more rate increases if inflation persists

(Image: AT&T/Graphic: The Desk)

An AT&T executive this week said more price increases could come for its wireless and broadband customers if a period of economic turbulence continues.

Speaking at an investor conference on Tuesday, AT&T Chief Financial Officer Pascal Desroches said inflation coupled with other key economic indicators could spur the telecom to plan for additional rate increases on customers.

Last month, the company increased fees for wireless customers on some of its older unlimited plans, with subscribers shelling out an additional $6 a month for a single line of service or $12 a month for family plans. Broadband customers also saw their fees go up, with AT&T Internet customers paying an extra $3 a month.

Officials at AT&T said the price hikes were necessary to cover rising costs associated with providing customers their services. On Tuesday, Desroches said those price hikes might not be enough, and the company may “have to look at pricing again as potential leverage to help offset” inflation and other economic turbulence.

“Inflation is probably the area I worry the most about,” the executive said, adding that rising costs of goods and services was “running hotter” than anyone at AT&T expected.

Desroches affirmed consumer demand was still somewhat strong, with churn rates at pre-pandemic levels. But he said continued economic uncertainty could force more customers to switch to another service.

“As I look at the inflationary expectation over the next several quarters, it’s hard for me to envision that that’s not going to impact the consumers negatively — we and others will see some pressure,” Desroches said.

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