AT&T proft grows 26%, woes grow for next year
AT&T has posted its quarterly earnings report which showed that profit as well as subscription numbers grew, but as the iPhone gears to head to other carriers it may be one of the last times AT&T can post these kinds of statistics.
Even as the iPhone remains exclusive to AT&T, the numbers are already beginning to slow down. During the second quarter of 2010, 496,000 new subscribers signed up for AT&T contracts but that is compared to nearly 1.5 million new subscribers in the second quarter of 2009.
"Our expectation this year is that net adds will be less than it has been in the last couple of years. That doesn't mean there isn't significant opportunity for growth," said AT&T CFO Rick Lindner, according to the Wall Street Journal.
AT&T blamed the growth of pre-paid cell phones partially for its slowing expansion. Additionally, even though more than 3 million new iPhones were activated during the quarter, a large proportion of them were from existing AT&T customers and not new ones.
Still, those staggering iPhone sales were able to make the bottom line, AT&T's profit, continue to soar over the past few months.
The company's profit reached a very impressive $4.02 billion, a significant jump from last year's second quarter result of $3.2 billion.
Surprisingly, though, even though AT&T always gets a lot of bad press the number of people who canceled or did not renew their contract fell to just 1.29% of customers, compared to 1.48% a year ago.
One thing is for sure, though - if in fact the iPhone begins to come over to other mobile carriers within the next year, it could hurt AT&T's bottom line in a big way.