John Stankey: Sky Mexico.
David Barden: Sky Mexico.
John Stankey: It’s a non-event.
Pascal Desroches: It really is a non-event, Dave. We didn’t consolidate it. It was an equity method investee that it wasn’t in the context of AT&T, not a significant item.
David Barden: Great. And then just one follow-up, if I could. Pascal, you said that we should expect a 20% rate of kind of run rate decline in DTV cash contributions on an annual basis, on a kind of go-forward basis? Is that the?
Pascal Desroches: Yeah. That is our best judgment, yes. And that’s the guidance we gave at the beginning of the year and that hasn’t changed. In Q1, there was some — last year there were some one-time items and that’s probably why you saw some of the decline year-over-year, but we feel good about the guidance we previously provided, which should put us at an around.
Operator: [Operator Instructions]
Pascal Desroches: Hello? Dave, are you still there?
David Barden: I’m here. I’m listening.
Pascal Desroches: Okay.
David Barden: All of it.
Pascal Desroches: Yeah. All right. Yeah. So for the year, we expect to have overall $3 billion of cash distribution from DIRECTV.
David Barden: Appreciate it, guys. Thank you so much.
Brett Feldman: All right. We’ll take the next question now.
Operator: Michael Rollins of Citi. Please go ahead.
Michael Rollins: Thanks for taking the question and good morning. When we look at the EBITDA growth for first quarter of the 4.3% year-over-year and compare that to the guidance of 3% range for the full year. Can you just frame some of the elements that may be changing, whether it’s by segment or between revenue and cash expenses just to think about the differences there? And then this could be a related question. Can you review your exposure to the ACP program, your expectations on the program possibly being discontinued and potential impact to AT&T’s financial results? Thanks.
Pascal Desroches: Okay. Mike, thank you for the question. Good morning. So first, as it relates to our segment level guidance, one, relative to the start of the year, as I noted in my comments, I anticipate business wireline will be a little bit worse than we thought, principally because of an acceleration of legacy voice decline. So putting that down in the mid-teens. But look you saw the strong start to both our mobility business including the record low churn. And consumer wireline, I mean, we delivered over 14% of EBITDA growth. And the dynamics for both, we would anticipate — what you saw in Q1, we would anticipate being there for the balance of this year. Those businesses are operating really well. The transformation work, we’ve done the last few years is really setting us up to have margin expansion in those businesses, and we feel really good about the trajectory of those two businesses.
Business wireline is, at an earlier point, in the product transition. And while we are growing fiber revenues, and as John mentioned, AT&T Internet Air for business, that’s going to grow. And of course, the wireless business relationships will also grow, but those will be offset by legacy declines and we’re confident we can manage through that in the balance of the year and still deliver on around 3%.
John Stankey: Mike, I think we indicated last quarter, and is still no different position that we could work through the ACP sunset if, in fact, that occurs, then I would say it’s probably more likely than not, that it does occur. And we could do so without any revisions or changes to what we guide you — guided you to and we still feel that way. We’ve started the process, as you might guess, of notifying customers and working with them, and we’re not just idly sitting by. I think we’ll be successful in many instances, finding ways to continue relationships with customers and ease them into different constructs that make sense for them. But I feel good about how we went about using the program. I think we used it consistent with the way that policymakers probably would have liked to have seen it used, which is to over index more than anything else on fixed broadband capabilities.
And I think we had a quality customer base relative to how the program was set up, and that’s going to allow us to probably transition some of them into other approaches for how to use the service and those that we ultimately do lose because of the subsidy sunsets. I don’t think it’s going to be anything that impacts ultimately what we’ve given you in terms of our ability to operate the business and hit our financials.
Brett Feldman: Great. Thanks, Mike. We’ll go ahead for the next question.
Operator: Sebastiano Petti of JPMorgan. Please go ahead.
Sebastiano Petti: Thank you. A couple of quick housekeeping questions. John, I think you talked about the balance growth on the mobility side. You have cited those are some underpenetrated segments. I was hoping you can give us an update on the opportunity there, I think SMB value and fiber selling on the mobility side. When do you expect to see some of the share gains, I guess, within some of these segments? Is that more of a — is that — could we see that within ’24? Does that take some time to build ’25 and beyond? And then on the business wireline side, I think, obviously, some focus there on the EBITDA trajectory, but you mentioned you are accelerating some cost cutting initiatives. Would that be within the context of the $2 billion cost cutting program? Or should we maybe think of these as additive to that program? Thank you.
John Stankey: Good morning, Sebastiano. I would tell you that as we indicated, we’ve accelerated some of the work that we’re doing. So this is things that probably would have occurred later in the cycle that we’re moving forward. So we’ll get some incremental run rate benefit to that, maybe and accelerating our forecast not necessarily changed endpoint, I guess, is the way I would describe that. And on our progress around, where we’re trying to make sure that we’re operating more effectively and how our channel distribution works within distribution, I would say that we’ve made some reasonable progress and have things in place around what we’re able to do to penetrate fiber, where we don’t have fiber on a wireless subscriber that is eligible to get fiber and the reverse of that.
