AT&T Profit Rises as Margins Improve
AT&T Inc. second-quarter earnings rose 8.7 percent as a lower customer turnover rate helped to improved margins.
AT&T has been adding fewer contract wireless customers in recent quarters as smartphone purchases have slowed since people rushed to buy the new Apple Inc. iPhone 4S in October. But the rate at which customers leave, known as churn, has been improving. AT&T is targeting alternative devices such as tablets and e-readers for new sources of revenue and is working to squeeze more out of existing customers through new services and fees, such as device-upgrade levies. AT&T also is continuing to shift attention away from its legacy businesses. In May, it sold a majority stake in its Yellow Pages business to private-equity firm Cerberus Capital Management LP in a $950 million deal.