AT&T ( T) posted a sharp rise in second-quarter earnings, beating Wall Street estimates by a nickel, and pledged to start buying back stock.For the quarter ended June 30, the San Antonio telco made $1.81 billion, or 46 cents a share, up from the year-ago $1 billion, or 30 cents a share. Excluding merger-related costs, earnings were 58 cents a share, soaring past the 53-cent Thomson Financial target. Revenue rose 53% from a year ago to $15.81 billion, reflecting last year's merger of AT&T with SBC. Cash from operating activities totaled $4.7 billion, up 24.1% from the year-earlier second quarter. "We delivered another strong quarter, with excellent growth in both earnings and cash flow," said CEO Edward E. Whitacre Jr. "Cingular generated solid subscriber growth and its best-ever churn. Enterprise trends continue to be encouraging. Regional wireline revenues extended their growth record. Our SBC/AT&T merger integration projects are very much on plan, generating synergies and benefiting customers. "These results demonstrate strong momentum as we look forward to the second half of the year and completion of our pending acquisition of BellSouth," Whitacre added. "Last week, shareowners of both companies approved the merger, and we expect to receive the remaining regulatory approvals necessary for closing the transaction this fall. "Now that the shareowner votes are complete, we plan to ramp up the share repurchase program we outlined in March," Whitacre said. "We expect to buy back $10 billion of our shares by the end of 2007, with approximately $2 billion to $3 billion coming this year." AT&T now expects its full-year adjusted consolidated operating income margin to be in the 17% to 18% range, up from its previous outlook of 15% to 16%. AT&T now expects to achieve full-year 2006 operating expense synergies from SBC/AT&T merger integration of $700 million to $900 million, up from its previous target range of $600 million to $700 million. Through the end of the second quarter, approximately $300 million of expense synergies had been realized.