Updated from 10:01 a.m. EDT

BellSouth

(BLS)

, the local telephone company, said Thursday that it missed Wall Street's earnings mark by a penny in the latest quarter, despite a 4.2% rise in profits and solid gains in revenue from data and wireless services.

BellSouth reported net income of $1.04 billion, or 55 cents a share, compared with profits of $994 million, or 52 cents a share, a year ago. But the increase did not satisfy Wall Street, which had expected earnings of 56 cents a share, according to

First Call/Thomson Financial

.

The third-quarter results include a charge of 2 cents per share related to BellSouth's newly acquired wireless properties in Colombia, according to the company, which is shifting its focus to digital broadband services and e-commerce for business customers.

For the three-month period ending Sept. 30, Atlanta-based BellSouth recorded revenue of $6.9 billion, a 7.5% gain from the comparable period of last year, and widened its customer base by more than 80%. Data revenue in the quarter climbed 28% to $894 million.

BellSouth said it had 134,000 customers for DSL and other high-speed access products, compared with 74,000 at the end of June. The company said it is confident it can boost that figure to 200,000 by the end of 2000.

The company also said it opened new e-business centers in Atlanta and Miami during the latest quarter to provide Web-hosting services.

BellSouth finished Thursday regular trading down 13 cents at $41.69.