Fears of a weakening overall economic environment were driven back a bit further this morning as AT&T like Verizon posted a steady quarter. Overall, earnings per share of $0.66 were a few pennies above expectations, while revenues were just a tad light at $31.6B.
Wireless powered the forward progress of course, as it always does nowadays, with 18.8% growth in wireless data revenues over last year. AT&T added 1.3M net wireless customers, with 320K net new post-paid customers beating the 200K that had been projected. ARPU was up 1.7% to $64.93, and wireless operating margins rose again to a 30.3% operating income margin.
Is it just me or does all this seem to contradict the narrative that massive data revenue growth will destroy the business model in a few years without regulatory relief to encourage investment in new capacity. Seems like these numbers would encourage further investment in infrastructure, not discourage it. Margins aren't exactly hurting for the big US wireless carriers as data revenues accelerate and voice/SMS get displaced.
Meanwhile, over in the company's less-loved wireline business, the story was familiar. Consumer uptake for video (U-verse) helped counterbalance pressure on both business and other consumer revenues. Enterprise data revenues ticked upward again, up 2.0% over the prior year as nextgen products outgrew legacy declines.