While Verizon did not report as many smartphone activations as it did in the previous quarter, AT&T’s first-quarter results, reported after the market closed Tuesday, showed that the carrier amassed 1.2 million new smartphone subscribers, a figure that contributed to the company’s best-ever first quarter in terms of smartphone sales. Now, more than 72 percent, or approximately 48.3 million, of all the company’s on-contract customers own smartphones. Additionally, AT&T added 296,000 new postpaid customers during the quarter.
For technology companies and wireless carriers alike, smartphones — along with their related accessories and services — are the most profitable business sectors. In evidence of this, AT&T’s gains in smartphone sales and contracts pushed its wireless revenue to $16.7 billion, an increase of 4 percent from the year-ago quarter.
In comparison, AT&T’s primary rival, Verizon, reported last week that it had added 677,000 new subscribers during the last quarter and sold 7.2 million smartphones…
Data is also proving to be a valuable aspect of AT&T’s business; wireless data revenue jumped 21 percent compared to the year-ago period. As smartphones’ capabilities increase, customers’ hunger for data has grown exponentially. So far, the carrier’s decision to implement shared data plans has progressed smoothly. Approximately 14 percent of customers have transferred to Mobile Share plans, and the convenience of having every device on one bill appears to be drawing customers away from their grandfathered unlimited plans. Even more interestingly, more than a quarter of the company’s Mobile Share accounts opted to go with a data plan containing 10 gigabytes of data or more.
Despite gains in these two important business — smartphones and wireless data, AT&T’s revenue fell short of expectations. Coming in at $31.4 billion, revenue was down 1.5 percent compared with the first quarter last year and slightly short of the consensus estimate. On an adjusted basis, the company reported earnings of 64 cents per share, which represented an 8.5 percent increase from the year-ago period. These results were in line with expectations.
In after-hours trading, shares fell as much as 2.44 percent to $38.05 after earnings were released.
Don’t Miss: Can Netflix Keep the Euphoria Alive?