AT&T profits up 25 percent on wireless growth
Customers are still in love with the iPhone, despite complaints about AT&T's network: the company added 2.7 million new wireless customers in the fourth quarter.
AT&T posted a 25.6 percent increase in fourth-quarter earnings as its wireless and new TV businesses continued to grow.
AT&T's earnings were also largely aided by sharp cost-cutting.
In the quarter that ended December 31, AT&T said Thursday, it earned $3.09 billion, or 51 cents a share. During the same period a year ago, the company earned $2.4 billion, or 41 cents a share. Revenue for the fourth quarter dropped slightly by about 0.7 percent to $30.86 billion, mostly due to weak sales in AT&T's legacy local-phone business.
AT&T met analyst expectations, which had pegged the phone company to report revenue of about $30.87 billion and earn 51 cents per share.
Wireless was once again a hefty contributor to AT&T's bottom line. And it appears customers are still in love with the iPhone, despite complaints about the company's network. AT&T said it added 2.7 million new wireless customers during the quarter.
AT&T beat rival Verizon Wireless in total wireless subscription additions. Verizonthat it added 2.2 million wireless customers during the fourth quarter.
That said, AT&T added only 910,000 so-called post-paid customers, who sign a contract for service. Verizon signed up about 1.2 million of these valuable customers. Customers on contracts typically pay more per month, and they tend not to leave the service as frequently as customers who pay as they go.
AT&T saw strong growth in wireless data service revenue. Revenue from these services, which include messaging and access to applications, was up 26.3 percent to $3.9 billion.
The company could see further growth in wireless data revenue as it adds non-phone devices, such as the new Apple iPad tablet, to its mix of products using its network. Apple for the much-anticipated new product.
AT&T also reported it added a total of 248,000 AT&T U-verse TV subscribers. It now services more than 2 million U-Verse TV customers. In total, AT&T added roughly 1 million U-verse customers in 2009.
AT&T will host a conference call later this morning to discuss results.