AT&T 2nd-Qtr net income climbs 26 pct, beats estimates, raises outlook, iPhone activations up
By Peter Svensson, APThursday, July 22, 2010
AT&T profit jumps 26 pct, boosts view
NEW YORK — AT&T Inc. said Thursday that its profit rose 26 percent in the latest quarter, helped by strong results in its wireless business and a one-time gain on a stock sale.
The country’s largest telecommunications provider said it now expects a “strong” increase in earnings this year, compared to its previous forecast of “stable-to-improved” results.
Its shares rose 38 cents to $25.30 in premarket trading.
AT&T said its net income rose to $4.02 billion, or 68 cents per share, in the April-June period, up from $3.2 billion, or 54 cents a share, a year ago.
Excluding a gain from the sale of stock in an overseas firm, its latest earnings would have been 61 cents per share, still beating the average forecast of 57 cents per share by analysts surveyed by Thomson Reuters.
Revenue was $30.8 billion, compared with $30.7 billion a year ago and slightly below analyst expectations at $30.9 billion.
AT&T is no longer including e-business subsidiary Sterling Commerce in its results, which analysts have not taken into account. The unit is being sold.
The Dallas company signed up a net 496,000 new wireless contract customers, down slightly from the 512,000 it signed in the first quarter. That’s about half of what it has signed up in recent years, but it will still likely prove a strong result compared to the rest of the industry, where new contracts have collapsed this year.
AT&T is helped by the iPhone, for which it is the exclusive U.S. carrier. AT&T said it once again activated a record number of iPhones: 3.2 million. That was boosted by the launch of the iPhone 4 in the last few days of the quarter.
Wireless service revenue grew 10 percent from a year ago, as average monthly fees rose 3.4 percent, again bucking the industry trend. Data plans for iPhones and other smart phones help AT&T offset declining prices for voice calls.
