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Alltel Misses by a Mile

Shares drop 6%.

Alltel's

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third-quarter numbers missed by a mile, sending shares down 6%.

The Little Rock, Ark., rural wireless giant posted adjusted net income of $230 million, or 60 cents a share.

Those numbers compare with pro forma earnings of $197 million, or 54 cents a share, a year ago.

The latest quarter was well below the 78 cents analysts were expecting.

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Total sales for the quarter were $2 billion, up from $1.8 billion last year, but way below the $2.5 billion analysts had been looking for, according to Reuters Research.

Net new subscriber additions were 101,000 for the quarter, not even close to the 180,000 some analysts were banking on.

Churn, or the monthly rate of customer defections, rose to 2.18% from 1.9% in the second quarter. Fans had hoped the company would score a bit higher on the user loyalty ratings.

"They blew it," says one money manager, referring to Alltel's third-quarter results.

But even though the quarter was weak by almost every measure, Alltel executives saw a silver lining.

"Our third-quarter growth demonstrates that we are striking the right balance between customer growth and long-term profitability. Our balance sheet also continues to gain strength as our net debt position is now under $1 billion," CEO Scott Ford said in a press release Friday.

Alltel shares slipped $3.57 to $54.61.