AT&T, one of the top phone carriers in the U.S., is noticing an alarming shift in customer behavior as it battles growing competition from rivals and faces controversy over its prices. In response to the growing trend, AT&T executives are calling out the primary sources of the problem.
In AT&T’s third-quarter earnings report for 2025, it revealed that while it gained 405,000 new postpaid phone customers during the quarter, its postpaid phone churn (the amount of customers who disconnected their phone service) increased by 14 basis points year-over-year.
The loss of more phone customers comes after it reduced its monthly discount for autopay and paperless billing in April. Customers who pay their monthly bill with a credit card saw their autopay and paperless billing discount completely removed, which sparked outrage.
AT&T also recently faced controversy for allegedly hitting customers with higher-than-expected monthly bills after luring them from rival phone carriers with generous discounts.
During an earnings call on Oct. 22, AT&T Chief Financial Officer Pascal Desroches said that the spike in phone customers pulling the plug on service follows “seasonal patterns.”
“Postpaid phone churn was 0.92%, up 14 basis points versus a year ago,” said Desroches. “This reflects increased marketplace activity and, to a lesser degree, an increase in the portion of our customer base reaching the end of device financing periods, which normalized as we exited the quarter. Based on this operating environment, we continue to plan for postpaid phone churn and upgrades to follow seasonal patterns in the fourth quarter, when we typically see more switching and upgrade activity due to new device launches and the holiday season.”
AT&T CEO John Stankey also flagged that competitors such as T-Mobile and Verizon have been “pretty aggressive” with tactics to lure customers.
“It’s been competitive,” said Stankey. “It continues to be competitive. There are shifts in tactics all the time that occur in this market, and we’re in a cycle right now that, because of the maturity level, tactics have shifted.”
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Recently, T-Mobile has been offering free phone lines and deals through its T-Mobile Tuesdays section of its T-Life app to lure customers. Also, Verizon has allegedly been using artificial intelligence to scan bills from rival phone carriers to offer customized deals to customers. Like T-Mobile, Verizon has even been offering generous Samsung and iPhone promotions.
