Before the splashy Apple event was held early in the day, things were looking a bit more grim for AT&T, which reports its fourth quarter results before market open on Thursday.
Ma Bell's exclusive deal to carry Apple's iPhone ends this year, and the telco giant has also had to contend with a marketing blitz from rival Verizon (VZ), in which a barrage of TV ads criticize AT&T's coverage.
AT&T's wireless subscriber growth is said to have slowed considerably, and analysts are anticipating that the company will report some lower-than-expected numbers."We expect AT&T to report 1 million post-pay adds -- slightly below our initial estimate of 1.1 million as momentum for the Q3 launch of the iPhone 3Gs wanes and Verizon's 'map' ad campaign impact results," wrote Jennifer Fritzsche, senior analyst at Wachovia, in a recent note. The analyst nonetheless predicts that AT&T will add a total of 2.25 million new wireless subscribers, driven by reseller net adds of 1.3 million, specifically strong e-reader demand. Analysts surveyed by Thomson Reuters expect AT&T to report revenue of $30.86 billion, down slightly from $31.1 billion in the prior year's quarter. Excluding items, the company is expected to earn 51 cents a share, compared to 64 cents a share in the prior year's quarter. Earlier this week rival Verizon put up mediocre fourth-quarter numbers of its own but added 2.2 million wireless subscribers during the quarter. With 1.23 million of those users direct retail customers, Verizon is clearly seeing strong demand for its Motorola (MOT) Droid phones and Blackberries from Research In Motion (RIMM).
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