AT&T Results in Line with Estimates

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Earnings at AT&T Corp. increased 46 percent during the
fourth quarter ended Dec. 31, fueled by gains in wireless services and cost reductions due
to early retirements.

The company also estimated that its pending acquisition of
Tele-Communications Inc. could help to boost revenue by another 5 percent to 7 percent in
1999.

Earnings for the fourth quarter were about $2.8 billion, or
$1 per share, compared with $1.3 billion (69 cents) in the prior year, keeping in line
with analysts' estimates. Total revenue for the company rose by 4.8 percent during
the period, to $5.7 billion.

For the full year, revenue was $53.2 billion, a 3.2 percent
increase over 1997, and earnings were $6.4 billion ($3.55 per share), a 44 percent
increase over the prior year.

Although analysts were somewhat disappointed that the
results did not exceed their expectations -- as they had in previous quarters -- a rumored
deal where AT&T would sell its Internet-service provider, WorldNet, to At Home Corp.
(parent of @Home Network) in exchange for $1 billion in At Home stock helped to boost
AT&T's standing.

"Scale begets scale," said Lou Kerner, an analyst
who follows At Home for Goldman Sachs & Co.

"[An At Home/WorldNet deal] would enhance the range of
services that are going to be offered and deepen the relationship with AT&T,"
Kerner added. "There is no doubt that there is a lot of land-grabbing going on.
People feel a lot of pressure to bulk up."

AT&T chairman C. Michael Armstrong added fuel to the
fire when he alluded to a possible deal between At Home and WorldNet at a Jan. 25
analysts' conference call on the fourth-quarter results.

Armstrong, commenting on the recent $6.7 billion deal
between At Home and Internet portal Excite -- which AT&T will become a partner in
after its acquires TCI, At Home's largest shareholder -- also mentioned a possible
connection with WorldNet.

"We might anticipate some relationship between [At
Home and WorldNet]," Armstrong said.

If such a deal goes through, it most likely would not be
announced until after approval is obtained for AT&T's merger with TCI.

AT&T shares rebounded at midday last Thursday, rising
by $3.94, to $89.25, after having fallen earlier in the week on the company's
announcement of its results.

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