Shares of American Tower (AMT -0.70%) were up 8.5% as of 1:50 p.m. ET Thursday after the communications-infrastructure company announced better-than-expected quarterly results.
A strong quarter for American Tower despite difficult macroconditions
American Tower's third-quarter revenue climbed 5.5% year over year to $2.819 billion, translating to a 30% decline in net income attributable to AMT shareholders to $587 million, or $1.26 per share. The latter drop is primarily attributable to goodwill impairment charges incurred during the quarter as it explores strategic alternatives for its India operations. Analysts, on average, were only expecting earnings of $1.13 per share on revenue of $2.76 billion.
As a real estate investment trust (REIT), a better metric than net income to gauge American Tower's success is adjusted funds from operations (AFFO), which effectively measures the company's cash flow from operations. American Tower's AFFO grew 9.5% year over year in Q3 to $1.206 billion and rose 9.3% on a per-share basis to $2.58.
American Tower CEO Tom Bartlett lauded the company's performance and "resiliency in an increasingly challenging macroeconomic environment." Bartlett added that organic tenant-billings growth arrived at more than 6%, while U.S. data center business revenue climbed over 9%.
American Tower just raised its guidance (again)
As such, American Tower now expects total property revenue in 2023 of $10.895 billion to $10.985 billion, up $60 million from its previous range and good for 4.5% growth at the midpoint. American Tower also guided for 2023 AFFO per share of $9.72 to $9.85, up 0.3% at the midpoint and an increase of $0.09 per share from its old range. And finally, the company now expects 2023 adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $7.01 billion to $7.09 billion, up 6.1% at the midpoint and a $60 million increase from its previous outlook.
All told, this was a solid beat-and-raise performance from American Tower as it proves yet again it can stand tall as a bastion of strength regardless of broader macroconditions. The stock is responding in kind today.
