AT&T Earnings: Margins EXPAND, Rings Profit UP

S&P 500 (NYSE:SPY) component AT&T Inc. (NYSE:T) reported its results for the second quarter. AT&T is a holding company whose subsidiaries and affiliates provide wireless and wireline telecommunications services and products to consumers and businesses worldwide. It also provides directory advertising and publishing services in the United States and international markets.

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AT&T Inc. Earnings Cheat Sheet

Results: Net income for AT&T Inc. rose to $3.9 billion (66 cents per share) vs. $3.59 billion (60 cents per share) in the same quarter a year earlier. This marks a rise of 8.7% from the year-earlier quarter.

Revenue: Rose 0.3% to $31.57 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: AT&T Inc. beat the mean analyst estimate of 63 cents per share. Analysts were expecting revenue of $31.72 billion.

Quoting Management: “We executed well across the business and posted another strong quarter with growing revenues, expanding margins and double-digit earnings growth,” said Randall Stephenson, AT&T chairman and chief executive officer. “Our mobile Internet leadership continues, with solid gains in smartphones and tablets, plus our wireless margins have never been better. And most impressive, with this growth, we also achieved our best-ever postpaid wireless churn, which points to the premier experience customers receive on our network. All of these things add to our confidence and enthusiasm looking ahead. In addition, with disciplined cost management our cash generation continues to be strong. This allows us to invest aggressively in our growth platforms while returning substantial value to shareowners through dividends and share repurchases.”

Key Stats:

Revenue has now gone up in each of the last three quarters. In the first quarter, revenue rose 1.8% to $31.82 billion while the figure rose 3.6% in the fourth quarter of the last fiscal year from the year earlier.

The company has now beaten estimates the last two quarters. In the first quarter, it topped expectations with net income of 60 cents versus a mean estimate of net income of 57 cents per share.

Looking Forward: For next quarter, analysts have a more positive outlook about the company’s expected results. The average estimate for the third quarter is 63 cents per share, up from 61 cents ninety days ago. Over the past three months, the average estimate for the fiscal year has climbed from $2.33 per to share to $2.37.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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