AT&T sold a record 10.2 million smartphones in Q4, bringing its postpaid smartphone customer base to 47.1 million and driving overall consolidated revenue for the company to $32.6 billion, up 0.2 percent versus reported results for the year-earlier period, and up 2.8 percent excluding Advertising Solutions and Superstorm Sandy impact. There was an operating loss of $6.0 billion, compared to a loss of $9.0 billion for the same period a year ago.
“We had an excellent 2012,” said Randall Stephenson, AT&T chairman and chief executive officer. “We grew revenues, increased adjusted earnings per share by 8.5 percent and generated cash from operations at record levels. We used this cash to invest aggressively in the future of our business and returned $23 billion to shareowners through dividends and share repurchases. Looking ahead, our key growth platforms — mobile data, U-verse and strategic business services — all have good momentum with a lot of headroom.”
Some highlights for Q4:
Wireless
- Wireless revenues, which include equipment sales, were up 5.7 percent year over year to $17.6 billion. Wireless service revenues increased 4.2 percent in the fourth quarter, to $14.9 billion.
- Wireless data revenues increased by 14.7 percent from the year-earlier quarter to $6.8 billion. Data revenue growth was slowed somewhat by the growth of Mobile Share plans.
- Net adds were 1.1 million, bringing the total base to 107.0 million. Subscriber additions for the quarter included postpaid net adds of 780,000, connected device net adds were 246,000, and reseller net adds were 234,000. Prepaid had a net loss of 166,000 subscribers primarily due to declines in GoPhone and session-based tablets.
- Postpaid subscriber ARPU increased 1.9 percent versus the year-earlier quarter to $64.98.
- Smartphones represent 89% of postpaid phone sales.
- At the end of the quarter, 69.6 percent, or 47.1 million, of AT&T’s postpaid phone subscribers had smartphones, up from 58.5 percent, or 39.4 million, a year earlier.
- AT&T’s ARPU for smartphones is twice that of non-smartphone subscribers.
- About 55 percent of AT&T’s postpaid smartphone customers now use a 4G-capable device.
- AT&T activated a record 8.6 million iPhones, with 16 percent new to AT&T.
- Postpaid churn was 1.19 percent, down when compared to 1.21 percent in the year-ago fourth quarter.
Wireline
- Wireline results were led by strong U-verse TV and high speed Internet gains and accelerating wireline consumer revenue growth.
- Wireline revenues were $14.9 billion, down 0.5 percent versus the year-earlier quarter but up 0.7 percent sequentially.
- Revenues from residential customers totaled $5.5 billion, an increase of 3.0 percent versus the fourth quarter a year ago and the strongest growth in more than four years.
- U-verse continues to transform wireline consumer. IP revenues now represent 61 percent of wireline consumer revenues, up from 53 percent in the year-earlier quarter and 45 percent two years ago.
- Total U-verse subscribers (TV and high speed Internet) reached 8.0 million in the fourth quarter. U-verse TV added 192,000 subscribers to reach 4.5 million in service.
- U-verse High Speed Internet delivered a fourth-quarter net gain of 609,000 subscribers to reach a total of 7.7 million, helping offset losses from DSL, and for the first time, the company has more consumer U-verse High Speed Internet subscribers than DSL subscribers.
- Overall, AT&T wireline broadband subscribers were flat; however, total broadband ARPU was up more than 10 percent year over year.
- Fifty-five percent of U-verse broadband subscribers have a plan delivering speeds up to 12 Mbps or higher — up from 46 percent in the year-ago quarter.
- About 90 percent of new U-verse TV customers also signed up for U-verse High Speed Internet in the fourth quarter. About 70 percent of AT&T U-verse TV subscribers take three or four services from AT&T. ARPU for U-verse triple-play customers was more than $170, up year over year. U-verse TV penetration of customer locations continues to grow and was at 18.7 percent at the end of the fourth quarter.
- Total business revenues were $9.1 billion, down 2.1 percent versus the year-earlier quarter and up 0.6 percent from the third quarter of 2012.
- Business service revenues declined 2.3 percent year over year and were up slightly sequentially. Business revenues were impacted by a slow economy and weak government and business spending. Overall, declines in legacy products were partially offset by continued growth in strategic business services.
- Revenues from strategic business services, the next-generation capabilities that lead AT&T’s most advanced business solutions — including Ethernet, VPN, hosting, IP conferencing and application services — grew 10.6 percent versus the year-earlier quarter, continuing trends in this area. Total business IP data revenues grew 2.4 percent year over year, continuing the transition from legacy data products to next-generation data services.