(Corrects paragraph four to 8.6 million iPhones, not 8.9 mln)
NEW YORK Jan 24 AT&T Inc's revenue rose
faster than expected in the fourth quarter as it added more
subscribers due to strong sales of smartphones like Apple Inc's
iPhone, sending its shares up 1 percent in late trade.
The No. 2 U.S. mobile service provider said on Thursday that
it added 780,000 subscribers in the quarter compared with the
average expectation for 699,200 from 10 analysts. Most estimates
were 700,000 or higher but the lowest was 475,000.
AT&T forecast earnings and revenue growth for the full year
2013 but said it is expecting little improvement in the economy.
While the company's sale of 8.6 million iPhones in the
quarter helped AT&T's subscriber numbers it hurt its profit
because AT&T pays Apple a big subsidy for every iPhone it sells
so it can offer a discount to customers who commit to contracts.
AT&T's wireless service profit margin based on earnings
before interest, tax, depreciation and amortization was 29.1
percent, compared with the average expectation for 31.29 percent
from ten analysts contacted by Reuters.
The company forecast earnings per share growth in the
upper-single digit percentage range or higher and revenue growth
exceeding 2 percent for 2013 based on strength in wireless and
its wireline consumer business.
"Guidance was good but not dramatically good," said Hudson
Square Research analyst Todd Rethemeier.
AT&T's fourth quarter loss was $3.86 billion or 68 cents per
share, compared with a loss of $6.68 billion or $1.12 per share
in the year-ago quarter when it took big charges including the
break-up fee for its failed purchase of T-Mobile USA, a Deutsche
Revenue rose to $32.58 billion from $32.5 billion and
compared with Wall Street expectations for $32.2 billion,
according to Thomson Reuters I/B/E/S.
While AT&T's wireless subscriber growth was better than
expected it was slower than bigger rival Verizon Wireless, a
venture of Verizon Communications and Vodafone Group Plc
, which reported subscriber additions of 2.1 million on
Sprint Nextel, the No. 3 U.S. mobile provider, does not
report its results until Feb. 7.
AT&T shares rose 1 percent to $34.13 after closing at $33.75
in the regular New York Stock Exchange session.
(Reporting By Sinead Carew, additional reporting by Nicole
Lesk; Editing by Bernard Orr)