AT&T Inc. (NYSE:T) has announced their first quarter earnings. AT&T had met the expectations of Wall Street as they reported earnings of $3.4 billion on revenues of $31.2 billion. They are up 2.3% from a year ago. AT&T’s subscribers have been increased due to tablets and e-readers.
AT&T added 62,000 net postpaid customers, but financial analysts were expecting the company to lose customers due to Verizon getting the iPhone. AT&T sold over 5.5 million smartphones in the quarter and 3.6 million of those were iPhones. AT&T also added 322,000 tablets in the quarter. About 2 million wireless subscribers were added across phones, tablets, e-readers, fleet management systems, and security systems.
Below is a statement from AT&T:
I think one of the most surprising areas, perhaps, is the fact that iPhone churn basically stayed flat. It did not increase. And I think as you think about what drove that and what caused those results, frankly I think it had less to do with customers being under contract. Of course, we always work hard with our upgrade policy to keep customers under contract and we do believe that it helps overall churn levels. But the fact is that it was well known for months and quarters in advance that another carrier would launch the iPhone. And yet, we continued to see customers upgrade their devices, enter into new contracts in the third and fourth quarters last year in record numbers, and that continued into the first quarter of this year when the phone was available on another carrier. And the reality is, even if customers were under contract, they had the ability to break that contract, pay a termination charge, and most likely take that device that they had and sell it and recover most, if not all, of that contract termination. So I don?t think having customers under contract had that large of an impact. You have to remember the iPhone is a device that carries a lot of data usage and a lot of traffic. For heavy data users, being on our network, having a faster data experience, having simultaneous voice and data, having the ability to use that device not just in the U.S. but around the world, were important to the iPhone customer base.