AT&T Corp. (NYSE:T) posted second-quarter profits of 49 cents a share Thursday, sneaking by First Call's estimate by a penny thanks to strong wireless and business units that offset weakening in its core consumer long distance operations.
Shares in the No. 1 U.S. long distance phone company closed at 54 15/16 Wednesday, below their 52-week high of 64 1/16.
Operational profits rose 8 percent, just above Wall Street expectations, the company said. Profits from continuing operations increased to $1.59 billion, or 49 cents a share, from $1.47 billion, or 54 cents a share, a year ago. Per-share earnings decreased because of an increase in shares outstanding, the company added
Second-quarter revenues rose 6.7 percent to $15.8 billion from $14.8 billion a year ago, making this the sixth consecutive quarter of revenue growth. Excluding recent acquisitions of cable television company Tele-Communications Inc. and International Business Machines Corp.'s (NYSE: IBM) Global Network, revenue rose 6.4 percent.
Revenue from AT&T's business services unit increased 6.7 percent to $6.28 billion, while revenue from core consumer services declined 3.4 percent to $5.50 billion.
Wireless phone services revenue gained 42.4 percent, adjusted for the acquisition of Vanguard Cellular Systems in May and the sale of AT&T's paging unit last year. The company's Broadband and Internet Services unit, which includes the cable operations of TCI, also rose, up 7.6 percent to $1.420 billion.
Earnings for AT&T's competitor MCI WorldCom (Nasdaq: WCOM) are also slated for Thursday release. Thirteen out of t30 analysts covering AT&T rate it a "strong buy," and 10 a "buy" according to Zacks Investment Research.
Reuters contributed to this report.