Earnings: AT&T Reports Record Number Of Mobile Subs In Q307, 10,000 New Users/Week For U-verse

AT&T (NYSE: T) today said that Q307 revenues nearly doubled to $30.1 billion, up from $15.6 billion in the same period a year ago (the latter did not include its acquisition of BellSouth, which was completed at the end of December 2006), with net income of $3.1 billion versus $2.2 billion in Q306.

Mobile: AT&T’s association with Apple (NSDQ: AAPL) is clearly paying off in terms of subscribers. Yesterday Apple reported 1.1 million customers for the iPhone, which is being sold exclusively with AT&T calling plans; in total the operator had a net gain of 2 million mobile customers in the quarter, representing growth of 46.8 percent, which it says is the highest increase in its history. AT&T now has 65.7 million subscribers, making it the largest wireless operator in the U.S. Revenues in the wireless division were $10.9 billion, up 14.4 percent from the year-earlier quarter. Wireless service revenues, excluding handset and accessory sales, grew 13.7 percent to $9.9 billion….more after the jump.

Mobile data services: Wireless data revenues grew by 63.9 percent compared to Q306. AT&T cited both consumer and business data usage for the rise. Services with heavy use included messaging, media bundles, laptop connectivity, smart phone connectivity and enterprise vertical market solutions.

Broadband, other content services: AT&T says its U-verse IPTV service is following its growth target of picking up 10,000 users per week; it now has 126,000 subscribers in all. Combined with its resale offering of satellite-based television broadcast service, total video connections grew by 215,000 in the quarter to 2.1 million. There is lots of room for growth still: AT&T says that only 6.7 percent of its total consumer base is currently receiving its video services. In broadband, which includes DSL, AT&T U-verse high speed Internet and satellite broadband services, the company picked up 499,000 users in the quarter to reach 13.8 million, up 2.2 million, or 18.6 percent, over the past year.

Release | Webcast | Slides

Conference Call: If there’s any truth to the rumors that AT&T is disappointed in the U-Verse rollout and looking to acquire a satellite operator, the company isn’t letting on. CFO Rick Lindner claimed the company is seeing “terrific progress with U-Verse” and that it’s ramping up as planned. Not surprisingly, he refused to comment directly on the merger speculation. Looking forward, it expects the U-Verse footprint to encompass 55-60 percent of its existing market, while 80 percent of those households could be reached without additional technical work. In the meantime, the company will continue its existing agreements with the satellite providers to provide video, although it may announce changes as those agreements expire near the end of this year.

Wireless: The company believes it’s still in the early stages of wireless growth, which will be driven by 3G adoption and subsequent ARPU increases. It currently has 1.1 million iPhone subscribers, although the device is just part of the story. Also mentioned were the AT&T Tilt and the Blackberry 8820

Merger: Much of the gains going forward will come form merger-related cost reductions. This year the company is well on its way to hitting a goal of $3 billion in savings, while it hopes to reduce costs by $6 billion in 2009.