AT&T Turns in Strong Q4
For the fourth quarter of 2007, AT&T earned $3.1 billion, or 51 cents per share, on revenues of $30.3 billion. In the same quarter of 2006, AT&T earned $1.9 billion, or 50 cents per share, on revenues of $15.9 billion. (See AT&T Reports Q4.)
Analysts had been expecting earnings of $3.08 billion, or 51 cents per share, on revenues of $30.5 billion, according to Reuters Research .
The giant leaps in sales and profits compared with a year earlier are easy to explain -- the merger with BellSouth had not closed by the fourth quarter of 2006, so the first true like-for-like comparisons will be available when the numbers for the first quarter of 2008 are published. Pro forma number supplied by AT&T show, though, that fourth quarter 2007 revenues were up 2.9 percent compared with a year earlier.
Not for the first time, AT&T's numbers were helped by record wireless subscriber additions, with the operator adding 2.7 million wireless subscribers in the final three months of 2007. Including the 1.7 million subscribers it acquired through its purchase of Dobson Communications, AT&T now has 70.1 million wireless subscribers. (See Dobson Merger OK'd.)
AT&T also ramped up its fixed line video subscriber base, exceeding its goal of installing 10,000 new U-verse subscribers per week by the end of 2007. It now has 231,000 subscribers, up from 126,000 at the end of the third quarter, and was installing new customers at a rate of 12,000 per week by the end of the year.
One area of decline for AT&T was in its enterprise business, where it saw revenues drop by 1.9 percent. AT&T noted this was due to a "decreased emphasis on CPE [customer premises equipment] sales" following a change of strategy during 2007, adding that "recurring enterprise service revenues, which exclude revenues from CPE and from assets acquired during the past year, increased 1.8 percent... driven by a 20.9 percent increase in revenues from IP-based data services such as virtual private networking, hosting and managed Internet services."
The solid results haven't been enough to protect AT&T's share price from the ravages of the macro financial market, however, as its stock was trading down $0.35, nearly 1 percent, at $36.34 in early trading Thursday.
— Raymond McConville, Reporter, Light Reading