AT&T Inc. has scrapped a plan to buy back $4 billion worth of shares in order to free up financial resources for coping with the coronavirus pandemic and its economic impact.

The carrier disclosed the move in a regulatory filing spotted by CNBC today.

On March 3, AT&T revealed that it had teamed up with Morgan Stanley to buy $4 billion of common stock in the second quarter under an accelerated share repurchase agreement. The carrier said in the filing that it has canceled the agreement and is moving to suspend other repurchases as well.

The decision is intended to ”maintain flexibility and focus on continued investment in serving our customers, taking care of our employees and enhancing our network, including nationwide 5G,” AT&T’s filing reads. “These continued investments will help ensure the Company is well positioned when the pandemic passes and economies begin to recover.” The carrier is reportedly also weighing to take out a roughly $3 billion loan to support operations. 

AT&T warned that the “impacts of the pandemic could be material, but due to the evolving nature of this situation, we are not able at this time to estimate the impact on our financial or operational results.”

Any hit that AT&T’s top line takes as a result of the coronavirus crisis won’t be for lack of users. Web traffic is up heavily worldwide as millions shift to working from homes and many schools adopt virtual learning models. Last week, AT&T and dozens of other internet providers agreed not to not to terminate service for consumers or small businesses in the next 60 days, as well as to waive any late fees incurred during that period.

Carriers are reinforcing their infrastructure to deal with the deluge of data traffic. AT&T, Verizon Communications Inc. and T-Mobile USA Inc., the three largest wireless providers in the U.S.,  are leasing spectrum rights from Dish Network Corp. to help bolster connection speeds. T-Mobile is also temporarily taking over parts of the airwaves owned by Comcast Corp. and other companies under an emergency plan approved over the weekend.

Global internet usage rose so sharply in recent days that some policymakers have raised concerns the surge could strain networks. To stave off that possibility, the European Union this week worked out an arrangement with Netflix Inc. under which the streaming giant will cut its bit rates by 25% in the bloc. Google LLC’s YouTube and Amazon.com Inc. said that they will too lower the quality of videos streamed in Europe to help free bandwidth.

Concerns about the impact of the coronavirus weighed on carrier stocks today. Verizon is trading 3.8% lower, T-Mobile’s market capitalization has shrunk by about 3.5% since the opening bell and AT&T is down more than 7% on the news that the $4 billion stock buyback plan is being scrapped.

Overall, the Dow Jones Industrial Average has slid 2.9% today while the tech-heavy Nasdaq Composite is down by about 1.6%. Even Amazon.com Inc.’s shares took a hit today, though videoconferencing provider Zoom Video Communications Corp. is up more than %.

Photo: AT&T