AT&T Profit Tops Estimates; Company Sees Net TV Customer Lossby
Carrier added 129,000 monthly subscribers, below projections
Company signed up 328,000 DirecTV satellite-TV users
AT&T Inc., the second-largest U.S. wireless carrier, posted first-quarter profit that exceeded analysts’ estimates even as the company saw a net loss of TV subscribers and added fewer mobile customers than analysts projected.
Earnings excluding some items were 72 cents a share, the Dallas-based company said in a statement Tuesday. Analysts projected 69 cents, the average of estimates compiled by Bloomberg. AT&T added a total of 129,000 monthly subscribers, fewer than the 283,000 average predicted by six analysts in a Bloomberg survey and less than gains by Verizon Communications Inc. and T-Mobile US Inc. The company lost a total of 54,000 video subscribers.
Hoping to avoid aggressive pricing battles with wireless rivals, AT&T’s plan is to find new growth among higher-spending customers through a bundled offer of mobile and video services. The company said last month it will have three types of streaming TV services available nationwide to mobile and online users this year -- a “skinny” bundle aimed at millennials, a mid-range offer with sports and original shows and a “chubby” bundle with a wider range of channels.
AT&T shares fell 1.5 percent to $37.53 in late trading after the earnings release.
- First-quarter sales were $40.5 billion, compared with projections for $40.4 billion.
- AT&T lost 363,000 lucrative monthly phone subscribers, more than the average estimated loss of 316,000 of six analysts surveyed by Bloomberg.
- The number of U-verse TV customers dropped by 382,000 U-verse while the company gained 328,000 DirecTV subscribers.
- Wireless margin on earnings before interest, taxes, depreciation and amortization from service revenue was 49.5 percent. Analysts predicted 47.92 percent on average.