AT&T Gets Second-Quarter Wireless Boost
DALLAS (TheStreet) -AT&T(T) comfortably beat Wall Street's profit forecast in its second quarter getting a boost from record wireless margins.
The telecom giant earned 66 cents a share, up from 60 cents a share in the prior year's quarter, and above the consensus estimate of 63 cents a share.
AT&T brought in revenue of $31.6 billion, a slight increase of 0.3% from the prior year's quarter, and just below analysts' estimate of $31.7 billion.
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Total wireless revenue came in at $16.4 billion, a year-over-year increase of 4.8%. Wireless data revenue was $6.4 billion, an increase of 18.8% over the same period.
The company also enjoyed its highest-ever wireless margins. AT&T's wireless operating income margin was 30.3%, compared to 26.9% in the second quarter of last year, and its wireless EBITDA service margin rose to 45% from 41.1% over the same period.
"We executed well across the business and posted another strong quarter with growing revenues, expanding margins and double-digit earnings growth," explained Randall Stephenson, the AT&T CEO, in a note released before market open.
Investors responded positively to the numbers, pushing AT&T's shares up 1.33% to $35.85 in premarket trading.
AT&T also enjoyed its best-ever postpaid, prepaid and total wireless churn during the second quarter. Postpaid churn dropped to 0.97% from 1.15% in the second quarter of 2011.
The Dallas-based company activated 3.7 million iPhones during the quarter, with 22% new to AT&T. This number, however, was down from 4.3 million iPhones during the first quarter.
Rival Verizon(VZ) activated 2.7 million iPhones during its own second quarter, results of which were released last week.
AT&T's total second-quarter smartphone sales were 5.1 million.
The company's total wireline revenue was $14.9 billion, down 0.8% from the prior year's quarter.
--Written by James Rogers in New York.