Telecommunications giant AT&T Inc. (T) on Thursday reported a hefty loss for the fourth quarter as several one-time items, including a charge related to termination of the T-Mobile USA acquisition, offset the impact of higher revenues. Adjusted earnings per share missed analysts' expectations, while revenues beat their view.
AT&T added a net 2.5 million wireless subscribers in the quarter, taking the total to 103.2 million subscribers in service. The company also sold 9.4 million smartphones in the quarter.
The company's fourth-quarter net loss was $6.68 billion or $1.12 per share, compared to net income of $1.09 billion or $0.18 per share in the year-ago period.
The results included as much as a $0.44 per share charge for termination of the T-Mobile USA acquisition in addition to non-cash charges of $0.65 from the actuarial loss on benefit plans and $0.48 for directory asset impairments.
Adjusted earnings per share declined to $0.42 from $0.55 in the year-ago period. On average, 32 analysts polled by Thomson Reuters expected earnings of $0.43 per share. Analysts' estimates typically exclude special items.
Total operating revenues for the quarter rose 3.6 percent to $32.50 billion from $31.36 billion last year and topped analysts' consensus estimate of $31.95 billion.
Total wireless revenues, which include equipment sales, increased 10 percent to $16.70 billion. Of this, wireless service revenues grew 4 percent to $14.35 billion. Wireless data revenue grew 19.4 percent.
AT&T said it made gains in every customer category, including 717,000 postpaid net additions. The company added 571,000 of branded computing subscribers, including tablets, to reach 5.1 million. This represents a 70 percent increase from a year ago.
AT&T sold 9.4 million smartphones in the quarter, nearly double the preceding third quarter and representing nearly 82 percent of postpaid device sales. The company activated more than 7.6 million iPhones in the quarter, majority of which were iPhone 4S.
Postpaid wireless subscriber ARPU (average monthly revenues per subscriber) grew 1.4 percent to $63.76 - more than $6 higher than nearest competitor's ARPU, the company noted.
However, wireline revenues declined 1.4 percent from last year to $14.92 billion.
For 2011 as a whole, AT&T's net income dropped to $3.94 billion or $0.66 per share from $19.86 billion or $3.35 per share in the prior year.
Excluding significant items, earnings per share declined to $2.20 from $2.29 last year. Analysts expected earnings of $2.22 per share.
Revenues for the year rose 2 percent to $126.72 billion from $124.28 billion in the previous year. Analysts expected revenues of $126.17 billion.
Looking ahead to fiscal 2012, AT&T forecasts earnings growth in a range of mid-single digits or higher, with an opportunity to accelerate earnings growth beyond 2012.
AT&T expects continued consolidated revenue growth, including postpaid wireless ARPU growth of around 2 percent for the year. The company also expects to expand consolidated and wireless margins while keeping wireline margins stable.
Analysts expect the company to earn $2.22 per share for the year on revenues of $126.17 billion.
T closed Wednesday's trading at $30.21, up $0.12 on a volume of 28.14 million shares. In Thursday's pre-market, the stock is down $0.41 or 1.36 percent to $29.80.
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