Earnings, Revenue Fall at SBC - TheStreet

Earnings, Revenue Fall at SBC

Still, the company's profit beats analysts' consensus estimate by a penny.
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SBC Communications


said second-quarter earnings and revenue fell from a year ago as competition and pension costs increased, but the company's results exceeded Wall Street's expectations.

For the three months ended June 30, SBC earned $1.39 billion, or 42 cents a share, compared with $1.78 billion, or 53 cents a share, in the year-ago quarter.

Revenue totaled $10.2 billion, down nearly 6% from $10.8 billion a year ago, excluding the company's share of the results from Cingular Wireless, which is 60%-owned by SBC. Cingular's revenue was $3.8 billion in the quarter.

SBC added 2.3 million long-distance lines in the quarter, taking its total to 9.8 million, up 77% from the end of the second quarter of 2002. The company also gained 304,000 DSL Internet subscribers for a total of 2.8 million, up 60% from a year ago.

Analysts polled by Thomson First Call expected the company to earn 41 cents a share in the second quarter.

"We had a tremendous quarter in long distance and DSL, the best our industry has seen. We also saw solid, sustainable progress at Cingular," Edward Whitacre, chairman and CEO, said in a press release. "We maintained good cost discipline -- despite increased marketing spending and postretirement benefit cost pressures -- while generating strong free cash flow and returning value directly to shareowners."