AT&T (T) Reports Profits Up Over 3 Percent

Shares of AT&T Inc. (T) traded lower in after hours trading, dropping -0.63 or 1.62 percent to $38.37 per share Tuesday afternoon, after the company announced a +3.2 percent rise in first quarter profits. Despite earnings being on target according to analyst estimates, shares were weaker due to the company missing its first quarter revenue forecast. AT&T shares closed at $39.00 per share, up +0.27 or +0.70% in Tuesday's regular trading session.

AT&T's first quarter earnings came in at $0.64 per share on revenues of $31.4 billion. Analysts expected earnings per share of $0.64 on revenues of $31.75 billion. While earnings were on target, the lower revenue figure was in part attributed to AT&T's loss of market share in the wireless subscriber market to Verizon Wireless (VZ). Daily Chart
Dallas, Texas based AT&T Inc. was founded in 1885 as the American Telephone and Telegraph Company and split up into several regional companies in 1983 following the settlement of an anti-trust lawsuit. As of last year, AT&T was the 17th largest company in the world by market value. The multinational corporation is the largest provider of fixed and mobile telephone services in the United States and also a major provider of broadband television subscriptions. While the company kept to its two percent estimate for 2013 revenue growth, AT&T is getting significant competition from Verizon Wireless. Verizon is attracting considerably more subscribers for their cell phone service, which is the most lucrative, while AT&T's subscription growth has come primarily from users of tablets and other devices which have a lower monthly fee. According to AT&T, the company added 296,000 subscribers to its services in the first quarter versus 187,000 in the same period one year ago. The figure included the net addition of 365,000 tablet users, implying a loss of 69,000 higher paying telephone subscribers. Analysts expected the company to get 195,000 new subscribers in Q1. In the company's post earnings conference call, CFO John Stevens stated that, "In wireless, it's all about the mobile Internet. Data growth was strong; Smartphone sales set another first quarter record. Tablet showed post-paid growth with an exceptional quarter, and customers continued to flock to our mobile share plans making it easier than ever to add new devices and drive further growth. This resulted in improved revenues, better margins, post-paid ARPU growth and lower churn." The addition of new subscriptions brings the total of AT&T subscribers top over 107 million. In addition to the increased number of subscriptions, the company also reported the sale of 4.8 million iPhones, keeping AT&T in the number one position for iPhone carriers in the United States. Despite the lower than expected revenue in the first quarter, AT&T stock is up more than fifteen percent year to date. The company announced a quarterly dividend of $0.45 payable on May 10th and a repurchase plan for 300,000 of its shares, representing 5.5 percent of the company's shares outstanding. If the company's commitment to buying its own shares is any indication, AT&T Inc. stock could continue being a sound investment. Other News About T AT&T Reports First Quarter Earnings With 72% of Subscribers Wielding a Smartphone Article on smartphones currently subscribed to AT&T services. AT&T Expands Digital Life Launch Markets Company to launch new technology in security and automation. Other Stocks in the News Apple Earnings Drop; Dividend, Buyback Raised Company reports lower earnings, share buyback and higher dividend. P&G Profit Beats Analysts' Estimates Amid Demand in U.S. Company reports better than expected profits. Copyright 2013 by, Inc. InvestorGuide has no control over the sites we link to, is not affiliated with these sites, and cannot take responsibility for their quality or suitability. The news, analysis, commentary and profile information is not meant to be comprehensive, and the data provided is not guaranteed to be accurate. WebFinance Inc., the publisher of this newsletter, is not a registered investment advisor or a broker/dealer. This is not a stock recommendation newsletter but rather a source for investment ideas, and we encourage you to fully research any company before considering investing. The opinions expressed herein are those of the author and do not necessarily represent the views of nor are they endorsed by WebFinance Inc. No employee of WebFinance has owned or currently owns any shares in the company described above. The above is neither an offer nor solicitation to buy or sell any securities. The trading of securities may not be suitable for all potential readers of this newsletter, and the purchase of stocks mentioned in this newsletter may result in the loss of some or all of any investment made. We recommend that you consult a stockbroker or financial advisor before buying or selling securities or making investment decisions. We are not responsible for claims made by advertisers and sponsors. Anyone who makes decisions based on what they read here does so at their own risk and cannot hold WebFinance Inc. (DBA, Inc.) or its employees responsible.

Published on Apr 24, 2013
By Jay Hawk
Jay Hawk
Jay Hawk enjoyed a 12-year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Since retiring as a full-time financial market professional, he has been actively trading stock, commodities, forex and options for his own account and managing funds for others, as well as writing financial market commentary and educational articles.

Copyrighted 2020. Content published with author's permission.

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