iPhone helps AT&T earnings jump 26 percent
7/22/2010 11:55:00 PM
kenmouse
, Posted in
A record 3.2 million iPhone activations helped boost AT&T's second-quarter earnings 26 percent year over year and prompted the company to increase its outlook for the full year.On Thursday, the carrier reported earnings of $4 billion compared with $3.2 billion in the prior year's quarter. Sales inched up 0.6 percent to $30.8 billion from a year ago.
The company attributed the surge in earnings to the 3.2 million iPhone activations during the quarter, with around 27 percent of those from customers new to AT&T. Preorders of Apple's iPhone 4 were 10 times higher the first day than those for the iPhone 3GS a year earlier, AT&T added.
The carrier also saw fewer people exiting its service, with its churn rate shrinking to a record low of 1.29 percent from 1.48 percent a year ago. Overall, it added 1.6 million wireless subscribers during the quarter to reach a total of 90.1 million customers, a 13 percent gain over a year ago.
"We delivered another strong quarter, with improved revenue trends, double-digit earnings growth and solid cash flow," Randall Stephenson, AT&T chief executive officer, said in a statement. "These results add to our confidence going into the second half of the year."
With the surge in earnings, AT&T revised its outlook for the full year. Though it didn't release specific numbers, the company now expects earnings per share, operating income margins, and cash flow to surpass their levels of 2008, an improvement from its prior forecast in which it said results would be on par with those in 2008.
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