Telecom's 800 metric ton Gorilla AT&T (NYSE:T, news, filings) reported earnings this morning, and apparently someone forgot to tell them about this 'worst recession since Hoover' thing. Riding the back of 1.6M iPhone activations, they earned $0.53 per share, some 5 cents higher than expected despite revenues of $30.6B checking in lighter than the expected $31.1B. No doubt analysts and the media will consider the latter more important since it is in the 'correct' direction. Overall, AT&T managed a nice quarter despite the economy, though I'd hate to see their numbers if they didn't have the iPhone. Verizon (NYSE:VZ, news, filings) doesn't have the iPhone, but it does have FIOS and will probably also show reasonable Q1 numbers.
AT&T did manage to lose a nice pile of wireline voice customers, but not quite the 1M that some had expected it seems. Many reports seem to link wireline losses are some sort of symptom of the recession, yet while the economy may make wireline losses a bit worse it isn't the source of those losses. It's just that voice over copper has a life cycle, and the needle on its dial says 'obsolete'. Even if the economy were booming right now, AT&T would still be bleeding wireline customers left and right.
The lack of sufficiently horrifying news for AT&T in particular is probably good news for the CWA in its labor negotiations, in that AT&T's ability to appear crippled by crushing health insurance costs aren't helped by earning yet another $3.1B during the quarter. There's been no strike so far, and frankly there's a good chance now there won't be. I don't think anyone really wants to make a scene right now.
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