AT&T Profits Flat Despite Strong Revenue Growth
Published on: 23rd Apr 2014
By: Ian Mansfield
USA based AT T has reported its best revenue growth in more than two years and its best first quarter contract customer sign ups in five years.
First-quarter revenues rose by 3.6 percent to USD32.5 billion, and the company has raised its outlook for the full year to expect revenue growth of 4 percent.
However, net profits were flat, at USD3.7 billion.
First-quarter 2014 cash from operating activities totaled $8.8 billion, and capital expenditures totaled $5.8 billion. Free cash flow -- cash from operating activities minus capital expenditures -- totaled $3.0 billion.
"Wireless postpaid net adds were more than twice as many as a year ago, AT&T Next sales surpassed our expectations, and we had a tremendous surge in Mobile Share plans of 10 gigs or higher." said Randall Stephenson, AT&T chairman and CEO. "We also had our best wireline consumer revenue growth since we first introduced U-verse in 2006 as our Project VIP build continues to make progress."
The company added 1 million net new wireless customers in the three months to the end of March, of which 625,000 were contract customers. Smartphones accounted for 92 percent of all sales during the quarter.
At the end of the first quarter, 57 percent of AT&T's postpaid smartphone customers used an LTE-capable device. The company sold 5.8 million smartphones in the quarter.
These gains were offset somewhat by a net loss of 50,000 prepaid subscribers, due to declines in session-based tablets, and a net loss of 206,000 reseller subscribers, primarily due to losses in low-revenue 2G subscriber accounts