AT&T CEO Randall Stephenson to retire, John Stankey to serve as new CEO

AT&T CEO Randall Stephenson has announced that he’ll be stepping down from his position, with current AT&T president and COO John Stankey set to replace him as the new CEO on July 1st, via CNBC. Stephenson will continue to serve as the executive chairman of AT&T’s board until January 2021.

Stephenson has served as AT&T’s CEO since May 2007, a time period that saw the company massively expand in both existing and new markets, with an attempted (but failed purchase of T-Mobile) in 2011, an acquisition of Leap Wireless in 2013, a purchase of DirecTV in 2014, and the landmark $85 billion Time Warner deal that closed back in 2018 after years of regulatory fighting and objections from the Justice Department.

Stankey became the heir apparent in September when AT&T named him the president and COO of the company. Stankey continued to oversee its WarnerMedia division as CEO, but started looking for a successor late last year. AT&T named former Hulu chief Jason Kilar as the new CEO of WarnerMedia in April, giving Stankey the space to move forward at AT&T without having to worry about overseeing the day-to-day operations of the company’s growing and controversial division.

Stankey’s move — first to COO and now to CEO — comes just months after activist investor Paul Singer’s Elliott Management publicly critiqued AT&T for its various media purchases. Elliot Management’s letter shed doubt on the decision to launch a direct-to-consumer streaming service, HBO Max, set to compete against Netflix and Disney Plus, in what many have taken to be a specific critique of both Stephenson and Stankey and their choices running the company. The shareholder battle ended a few weeks later with AT&T reaching a deal with Elliot Management that promised “significantly enhanced operational efficiency with meaningful margin expansion, a “full review of the portfolio,” “no more major acquisitions,” and a seperation of the roles of CEO and chairman of the board.

Despite that past history, though, Elliot Management is reportedly on board with Stankey’s appointment to the role of CEO, according to CNBC.

Both Stephenson and Stankey have stood by HBO Max as an integral part of AT&T’s future, especially as the traditional cable and satellite divisions continue to suffer. Stephenson described it as a “meaningful business” to the company that will play out over the next four to five years. AT&T lost lost 138,000 AT&T TV Now streaming service subscribers in the most recent quarter, which followed a loss of 219,000 subscribers in the fourth quarter. AT&T also recorded a 897,000 loss of premium TV subscribers at DirecTV and U-Verse. The company lost more than one million TV subscribers overall.

Stankey is a champion of WarnerMedia, and having him in the top role at AT&T demonstrates the continued investment in and importance of WarnerMedia as AT&T moves forward, even as his new postion will put him in charge not only of AT&T’s media business, but the company’s broader telecommunications services as well.