NEWS: AT&T quarterly net income jumps 25%, Phone giant adds 1.6 million wireless accounts

AT&T Inc. reported a 25% increase in second-quarter profit Thursday, helped by strong wireless growth and a sharp cost reductions.

The Dallas-based company added 1.6 million wireless connections to top

90 million connections for the first time, and it activated a record 3.2 million iPhone accounts. AT&T, Apple Inc.'s exclusive U.S. distributor, got a boost late in the quarter from the release of the iPhone 4.

"3.2 million iPhone activations - that's huge," said James Brehm, a mobile analyst at market researcher Frost & Sullivan.

More than half of the new connections, however, involved nontraditional devices such as e-book readers or alarm-monitoring systems, which generate high profit margins but relatively little revenue.

Only 496,000 new customers chose wireless-calling plans with annual contracts. Just a few years ago, AT&T and top rival Verizon Wireless used to sign up as many as 2 million contract customers each quarter when the U.S. market was still in a major growth phase.

As the U.S. wireless market matures, AT&T has moved aggressively to connect all sorts of devices to its network as a means to lift sales. It's also signing up more mobile customers for data and Internet plans.

The effort appears to be working. AT&T upped its forecast for 2010, saying it now expects "strong earnings-per-share growth" and higher free cash flow compared to the prior year.

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Reply to
John Navas
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That's a lot of Kindles and Nooks. I guess the iPad isn't decimating the standalone ebook market as some have predicted...

Reply to
Todd Allcock

Under $200 vs over $500 is a big difference for people who are primarily interested in reading books.

Reply to
DevilsPGD

The price of Kindles and Nooks is getting low enough that I could see having one in addition to my iPad. Something that could be taken to the pool or beach. When they get to $100, which I think they might, I will get one for sure.

Reply to
Charles

I'm in exactly the same boat -- I read on both my iPhone and iPad, but am still giving serious thought to a Kindle. Were it just a little bit cheaper, I'd buy right now.

Once I buy, I'll use it a whole bunch for a couple months, then I'll go back to my iPad to lend the Kindle to friends and family, and probably get 3-4 more sales out of them before getting it back and/or someone (Hi mom!) will keep it and I'll buy a new one for me.

Reply to
DevilsPGD

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