AT&T (s T) reported first quarter financials today with net income of $3.1 billion on revenue of $30.6 billion. The economy kept AT&T’s revenue flat from the first quarter of last year, but net income dropped by 11 percent. The wireless business (including the desirable iPhone exclusive) and gains in its U-verse high-speed Internet and IP video product, are are helping AT&T weather the economic storm, even as its voice and wired customer base shrinks.
The carrier activated 1.6 million iPhones during the quarter, and saw its net wireless subscription adds for reach 1.2 million (71 percent were subscribers who signed a contract). Despite the growth in prepaid calling as the economy falters, AT&T picked up fewer prepaid subscribers this quarter as compared to the first quarter of 2008, and contract customers made up a greater percentage of the carrier’s net additions.
U-verse is also going strong, with AT&T adding 284,000 net subs, almost double its growth for the January through March period last year. AT&T now has 1.3 million U-verse video customers. AT&T no longer breaks out its DSL subscriptions, but it added 359,000 wired broadband subscriptions in the first quarter, growing those subscriptions by 52 percent from the previous quarter. On the wireline business, data was the only segment that saw revenue growth. Meanwhile, AT&T’s voice subscriptions, which includes land lines as well as U-verse voice, fell by 11.7 percent. When it came to wired customers, AT&T lost 196,000 customers for the quarter — double its losses in the year ago period.
In bad news for those in the telecommunications equipment industry, AT&T’s capital expenditures dropped by 24 percent from the same period in 2008 to $3.2 mbillion.