Telecommunications giant AT&T Inc. (T: Quote) on Tuesday reported a 5 percent increase in profit for the first quarter, aided by strong mobile data growth. Earnings per share beat analysts' expectations.
The company's wireless margins expanded along with strong smartphone sales. AT&T sold 5.5 million smartphones in the quarter, exceeding the previous first-quarter record, with about 30 percent of all postpaid smartphone subscribers on 4G-capable devices.
The company activated more than 4.3 million iPhones in the quarter, with 21 percent new to AT&T.
Randall Stephenson, chairman and chief executive officer of AT&T said, "We continue to capitalize on our terrific momentum in mobile Internet. Smartphone and branded computing device sales continue to set a record pace, mobile data revenues were up nearly 20 percent, and we achieved this growth with expanding margins."
Total wireless revenues for the quarter, including equipment sales, increased 5.4 percent to $16.14 billion. Of this, wireless service revenues grew 4.3 percent to $14.57 billion.
Wireless data revenue grew 19.9 percent, driven by Internet access, access to applications, messaging services and related services.
AT&T posted a net increase in total wireless subscribers of 726,000 in the first quarter to reach 103.9 million in service. This includes gains in every customer category.
Subscriber additions for the quarter include postpaid net additions of 187,000. This compares to net additions of 62,000 in the prior-year period and 717,000 in the preceding fourth quarter.
The company added 460,000 of branded computing subscribers, including tablets, to reach 5.8 million in the quarter. This represents a 70 percent increase from a year ago.
Postpaid wireless subscriber ARPU (average monthly revenues per subscriber) grew 1.7 percent to $64.46. Postpaid churn, or customers who cancel services, reached the lowest level in seven quarters.
Meanwhile, AT&T's wireline revenues for the quarter declined 0.8 percent from last year to $14.93 billion.
The company's first-quarter net income was $3.58 billion or $0.60 per share, up from $3.41 billion or $0.57 per share in the year-ago period.
On average, 31 analysts polled by Thomson Reuters expected earnings of $0.57 per share for the quarter. Analysts' estimates typically exclude one-time items.
Revenues for the quarter rose 1.8 percent to $31.82 billion from $31.25 billion in the previous-year quarter. Analysts had a consensus estimate of $31.85 billion.
T closed Monday's trading at $30.61. In Tuesday's pre-market, the stock is adding $0.34 or 1.11 percent to $30.95.
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by RTT Staff Writer
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