Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now


AT&T Reports Record Low Churn In Q2

Dallas – AT&T
reported its second-quarter financial results, which included double-digit
earnings growth, an increase in consolidated revenues, improved margins, and
record low churn rates.  

These results were
driven by continued growth in mobile broadband, including a record quarter for
iPhone activations, gains in IP-based and strategic business services and
disciplined execution on cost initiatives, AT&T said in a statement.

For the quarter,
ended June 30, AT&T’s consolidated revenues totaled $30.8 billion, up $194
million, or 0.6 percent, vs. the prior-year quarter. AT&T said this marked
its second consecutive quarter with a year-over-year revenue increase. Quarter
over quarter, consolidated revenues were up $278 million, or 0.9 percent.

Compared with
results for the second quarter of 2009, operating expenses were $24.7 billion vs.
$25.1 billion; operating income was $6.1 billion, up from $5.5 billion; and
AT&T’s operating income margin expanded to 19.8 percent, up from 18.0
percent. Total employee force is down by more than 10,000 since year-end 2009,
the company said.

In its wireless
business, AT&T reported an organic net gain in total wireless subscribers
of 1.6 million, to reach 90.1 million in service.

net add growth reflects rapid adoption of smartphones, increases in prepaid
subscribers and growth in a host of connected devices such as e-readers, global
positioning systems and alarm monitoring systems,” AT&T said. Connected
devices net adds were 896,000 in the quarter to reach 6.7 million, and retail
postpaid net adds totaled 496,000 to reach 67.0 million.

The company said
it had record lows in both total and postpaid wireless churn — 1.29 percent
and 1.01 percent, respectively. 

Wireless data
revenues increased $936 million, or 27.2 percent, from the year-earlier quarter
to $4.4 billion. AT&T wireless subscribers on data plans increased more than
24 percent over the past year, it added.

subscriber ARPU increased 3.4 percent vs. the year-earlier quarter to $62.63,
despite including 1.6 million subscribers from the acquisition of properties
from Verizon Wireless. This marked the sixth consecutive quarter AT&T has
posted a year-over-year increase in postpaid ARPU, according to the company.

Postpaid data ARPU
reached $21.07, up 18.6 percent vs. the year-earlier quarter, and total
postpaid subscriber revenues continued recent trends, with solid double-digit
growth, reflecting increases in both voice and data.

AT&T said that
key drivers of wireless data growth are increased penetration of integrated
devices (handsets with QWERTY or virtual keyboards) and greater usage of the
company’s mobile broadband network. The number of 3G postpaid integrated
devices on its wireless network increased by 2.9 million to 29.7 million, an
increase of 98.2 percent year over year and 10.8 percent sequentially.

At the end of the
quarter, 53.2 percent of AT&T’s 67 million postpaid subscribers had
integrated devices, up from 36.3 percent one year earlier.

For the full
second quarter, AT&T iPhone activations totaled 3.2 million, the most quarterly
iPhone activations ever, it said. Approximately 27 percent of those activations
were for customers who were new to AT&T.

wireless operating income margin was 28.8 percent vs. 24.9 percent in the year-earlier
quarter, and AT&T’s wireless operating income before depreciation and
amortization (OIBDA) service margin was 43.1 percent, up from 40.1 percent in
the second quarter of 2009.

Wireless service
revenues increased 10.3 percent to $13.2 billion in the second quarter, it said
and total wireless revenues, which include equipment sales, were up 7.7 percent
to $14.2 billion. Second-quarter wireless operating expenses totaled $10.1
billion, up 2.1 percent vs. the year-earlier quarter, and wireless operating
income was $4.1 billion, up 24.7 percent year over year.