AT&T Quarter on Track - TheStreet

AT&T Quarter on Track

The second quarter beats estimates.
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AT&T

(T) - Get Report

beat second-quarter earnings estimates, as the telco enjoyed strong growth in its wireless business, led by last month's launch of the

Apple

(AAPL) - Get Report

iPhone.

The San Antonio, Texas, company made $2.9 billion, or 47 cents a share, for the quarter ended June 30, up from the year-ago $1.8 billion, or 46 cents a share. Revenue rose 87% from a year ago to $29.48 billion, reflecting last year's acquisition of BellSouth.

On an adjusted basis, adjusting for the BellSouth acquisition, earnings were 70 cents a share in the latest quarter. Pro forma revenue, reflecting results from AT&T, BellSouth and Cingular Wireless consistently for all periods, rose 2% from a year ago to $29.8 billion.

Analysts surveyed by Thomson Financial were looking for a 67-cent profit on sales of $29.62 billion.

"AT&T has a strong foundation for growth in wireless and IP-based services, and in the second quarter we improved our trajectory in key areas," said CEO Randall Stephenson, who recently took over for Ed Whitacre. "Wireless revenue growth accelerated for the fourth consecutive quarter. Our U-verse video service has begun to ramp aggressively. And we took a major step up toward revenue growth in enterprise services, where AT&T has tremendous assets and great potential."

Wireless service revenue rose 15% from a year ago to $9.5 billion, with the company adding 1.5 million wireless users, including 912,000 postpaid net additions. Wireless service average revenue per user, or Arpu, rose 3.6% to $50.63, while postpaid Arpu rose 6%.

The company said sales of the Apple iPhone "have been robust." AT&T activated 146,000 iPhone subscribers in the last two days of the quarter. "Sales of the iPhone continue to be strong in July with store traffic above historical levels," AT&T said.