AT&T: Thank God for Vitamin i
If AT&T’s latest earnings are a decent gauge of the health of the telecom market, then the telecom market is only slightly under the weather. The company’s fourth-quarter net income fell 23.3 percent and its earnings of 64 cents missed analyst estimates by a penny, but it added 2.1 million wireless subscribers–including 1.9 million iPhone accounts.
“Despite the economic environment, we grew revenues in 2008, and I expect 2009 will be another year of overall revenue growth and solid progress for our company,” AT&T CEO Randall Stephenson said in a statement. “During the past year, we took major steps to improve AT&T’s position for 2009 and beyond. The success of our iPhone 3G launch has driven wireless growth and helped redefine the wireless data space.”
Thank God for vitamin i, eh? Apple’s (AAPL) device is not only wildly popular, but quite lucrative as well. Average revenue per user for iPhones is 1.6 times higher than with other AT&T handsets, and churn rate is significantly lower. AT&T (T) says it activated 4.3 million iPhones in the second half of the year. No wonder; AT&T expects “2009 to be another year of overall revenue growth and solid progress for our company.”
Said Stephenson, “Looking ahead, while we are cautious about the economic environment, AT&T is well positioned with a strong balance sheet and premier operational assets, and I am very confident in our ability to execute.”