AppleInsider Staff
Despite more impressive pre- and post-paid subscriber growth from rival U.S. telcos, AT&T managed to post a profit of $6.9 billion on $33.6 billion in revenue for the fourth quarter of 2013.
In an earnings statement released on Tuesday, AT&T cites record-low post-paid churn rates (or the percentage of customers who left the carrier) and smartphone sales gains as drivers for the company's $33.6 billion in revenue, which represents a two-percent rise from $33.2 billion in 2012. Revenue from wireless operations grew 4.8 percent year-to-year to hit $15.7 billion, while data services revenue was up 16.8 percent at $5.7 billion.
Year-over-year, the $6.9 billion in profit, or $1.31 per share, is a vast improvement from 2012's loss of $3.9 billion, or 68 cents per share. Excluding a pensions-related gain of $7.6 billion, taxes and other expenses, adjusted earnings came in at 53 cents per share. The number beat analyst expectations of 51 cents for the quarter, reports the Associated Press.
For the December quarter, AT&T reported a gain of 809,000 net wireless subscribers, 566,000 of which were on more lucrative post-paid contracts. Broken down further, 299,000 of the post-paid net adds were smartphones.
AT&T saw fourth-quarter post-paid churn at 1.11 percent, down from 1.19 in the year ago period. When considering pre-paid subscribers, overall churn was at 1.43 percent versus 1.42 percent in the year-ago quarter.
The telecom hit another record with smartphones, which accounted for 93 percent of all phone sales during quarter four. AT&T added 1.2 million post-paid smartphones to its user base, which now accounts for 77 percent post-paid phone subscribers. Growth in the sector is slowing, however, as only 7.9 million smartphones were sold in the quarter, down from 10.2 million over the same period last year.
Tablets were a major factor in the telecom's performance. Over the quarter, AT&T logged 440,000 net tablet adds.
While AT&T's results are promising, the nation's largest carrier Verizon added 1.7 million subscribers in quarter four. Smaller carriers like T-Mobile are also nibbling away marketshare with lower-cost plans and incentives for switching.
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17 Comments
I’m all for beating the Street.
Someone give me a baseball bat with the word “common sense” carved into it. I’ll turn that pavement into sand.
Left AT&T for MetroPCS. I'm now paying 1/3rd of my previous bill for unlimited calling, texting and data ($40/month including tax). LTE speeds are through the roof (50Mbps down/25Mbps up this morning near San Jose airport). In contrast, AT&T's "grandfathered unlimited data" throttled me to unusable speeds after 2GB. Metro throttles their $40 plan after 500MB, but to 3G speeds -- hardly noticeable, you can still stream audio to your heart's content. You even get visual voice mail. AT&T? It's for suckers.
[quote name="Tallest Skil" url="/t/161806/at-amp-t-beats-street-with-6-9b-q4-profit-shows-strong-contract-customer-retention#post_2464482"]I’m all for beating the Street. Someone give me a baseball bat with the word “common sense” carved into it. I’ll turn that pavement into sand. [/quote] This is not good for the carrier revolution.
I switched my whole family to T-Mobile and so far, we couldn't be happier. We were on Verizon, Cingular/AT&T before that and while their coverage was pretty solid, it wasn't worth renewing for another 2 years with Verizon. It has also been a little slower on LTE in Los Angeles, so that was a motivator to switch. I hit 40mbps in a couple areas where I frequent on T-Mobile, so I am a happy nerd. Plus the clearer structure of the plans, is refreshing. The HD Voice on T-Mobile is great too, although a bit jarring because of the clarity. Cell calls to my family sound like the clear calls I get from FaceTime audio.
AT&T & Verizon are scummy companies and I hope T-Mobile lives up to their promise. If their reception improves, as it looks like it is, then I'll never look back.
Yep, I'm in the process of switching from AT&T to T-Mobile and will save at least $70/mo with more features and no overage charges!