28 Jul 2012

[News Update] AT&T Results Beat Expectations as Smartphone Sales Fall

AT&T Results

AT&T reported Q2 results on Tuesday, posting its highest ever wireless profit margin, driven by lower smartphone sales. AT&T reported activated 5.1 million smartphone activations in Q2 2012, as compared to 5.5 million last year.  AT&T's iPhone activations dropped 14% from the last quarter to 3.7 million, which helped boost profitability.  

AT&T's tighter upgrade policy reduced new smartphone sales, which reduced carrier subsidy costs and increased wireless operating profit by 18%. This reinforces the fact that carrier subsidies, especially for the iPhone, are a major drag on the profitability of US carriers and may embolden AT&T to demand more reasonable subsidies from Apple when their iPhone contracts runs out.






0 comments:

Post a Comment