AT&T (T) had a solid quarter, led by its wireless business and its growing digital TV service, U-Verse.
Revenue fell to $30.57 billion, below the $31.08 billion the Street was expecting. But EPS of $0.53 beat the Street’s expected $0.48.
More importantly, its wireless business continued to report strong growth despite the slow economy. AT&T reported 1.2 million net new subscribers, roughly flat with last year and in-line with expectations. But higher-quality “postpaid” net additions — subs that sign long-term contracts — increased 24% year-over-year to 875,000 net additions. AT&T said it activated 1.6 million iPhones during the quarter. That could be bad news for Verizon Wireless, AT&T’s arch rival.
Meanwhile, AT&T’s U-Verse TV business is off to a strong start this year. AT&T says it added 284,000 net subs, almost double its growth in Q1 ’08, and 264,000 net additions during Q4 ’08. That could be bad news for cable companies like Comcast (CMCSA).