Apple iPhone A Boost For AT&T In Second Quarter9:46 AM EST Thu. Jul. 23, 2009
Though slightly down, AT&T posted better than expected second quarter numbers, mostly thanks to a boost from the Apple iPhone and the new Apple iPhone 3G S.
AT&T's exclusivity contract to be the only U.S. Apple iPhone carrier has paid off again in the second quarter as AT&T posted revenue of $30.7 billion.
In the second quarter, AT&T added 1.4 million net subscribers, including 1.2 million retail monthly bill-paying customers. Additionally, AT&T said it activated more than 2.4 million Apple iPhone smartphones in the second quarter, and more than a third of the newly-signed iPhone users being new AT&T subscribers. The iPhone push helped AT&T end the quarter with a total of 79.6 million wireless subscribers, placing second behind rival Verizon Wireless.
One analyst told Reuters that excluding the Apple iPhone, AT&T signed 25 percent fewer customers in the second quarter compared to the first. But the iPhone and the release of the new iPhone 3G S toward the quarter's end upped new subscriber numbers. According to AT&T, the June 19 launch of the Apple iPhone 3G S was the best sales day ever for AT&T's retail and online stores. The Apple iPhone 3G S went on to sell more than one million units in its first weekend on the market.
AT&T, however, said it incurred increased operating expenses due to the Apple iPhone 3G S launch and the smartphone's subsequent success, which AT&T heavily subsidizes.
Overall, AT&T slid slightly on profit, dropping to $3.2 billion in the second quarter compared to $3.77 billion a year ago. AT&T's revenue also fell slightly, 0.45 percent, to $30.73 billion, though revenue beat analysts' expectations.