Wireless Data Usage Boosts Results at AT&T By DAVID BENOIT Wall Street Journal
July 23, 2008 10:03 a.m. http://online.wsj.com/article/SB121679467875776759.html?mod=hps_us_whats_news AT&T Inc. reported a 30% increase in second-quarter net income as the wireless business continued to gain and from subscriber use of internet and email on phones produced a large surge in data revenue. The Dallas company posted net income of $3.77 billion, or 63 cents a share, up from $2.9 billion, or 47 cents a share in the previous year. Excluding merger-related costs, earnings rose to 76 cents from 70 cents. Revenue rose 4.7% to $30.87 billion. The mean analyst expectations polled by Thomson Reuters were for earnings of 76 cents a share on revenue of $31.15 billion. Earnings at AT&T's wireless unit surged 91% as revenue increased 16%. Minus merger costs, profits rose 39%. The unit added 1.3 million net new subscribers, down 8.4% and below Verizon Wireless's growth of 1.5 million. AT&T's total wireless subscribership is now 72.9 million. Total churn, or turnover rate, for more-attractive postpaid contract customers dropped to 1.1% from 1.2%. Wireless data revenue - money that its customers pay for browsing the Internet on their cell phones and sending wireless emails - climbed 52% and average revenue per user, an important mark for telecoms, rose 3.5%. Wireline earnings fell 2.4% as revenue dropped 2.1%. While down, the declines are narrower than prior quarters. Phone companies used to be largely insulated from economic downturns because most consumers considered their home phone service a necessity. But 80% of Americans now own cellphones, making it easier for them to ditch their landlines and internet and cable packages offer better deals as well. Looking ahead, the upgraded version of Apple Inc.'s iPhone is supposed to boost sales in the third quarter. But with AT&T footing a subsidy bill as high as $720 million to make the 3G available at $199, the company expects to take a hit on earnings. Before the phone was released, AT&T said subsidy costs would cut into earnings by 10 cents to 12 cents a share this year and next. The company said Wednesday that sales of the iPhone 3G in the first 12 days of its launch doubled that of the original device's release last year. ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 antunes at uh dot edu ******************************* * POST TO [EMAIL PROTECTED] * ******************************* Medianews mailing list [EMAIL PROTECTED] http://lists.etskywarn.net/mailman/listinfo/medianews
