AT&T Reports Higher Profit, Strong Start to 2016

AT&T reported a better-than-expected profit of nearly $3.9 billion for the first quarter of 2016 and a 24 percent increase in revenue from the year-ago quarter, mostly from last summer’s DirecTV acquisition.

The telco reported a little more than $3.3 billion in profit for the same quarter in 2015. Revenue for the latest quarter totaled $40.5 billion, up from a little less than $32.6 billion for the year-ago quarter — and beating analysts’ estimates.

“It was a good start to the year,” said Randall Stephenson, AT&T’s chairman and CEO. “We had solid financial results and executed well on our strategy to be the premier integrated communications provider for businesses and consumers. We’re seeing good momentum with our initial integrated wireless, video and broadband offers. And we’ll expand the integrated choices for customers in the fourth quarter when we launch our new video streaming services.”

AT&T reported 2.3 million North American wireless net adds driven by connected devices, Mexico and Cricket, as well as 712,000 branded (postpaid and prepaid) phone net adds.{ad}

In business wireline, declines in legacy products and equipment revenues were partially offset by continued growth in strategic business services. Total business wireline revenue was $8 billion, down 2 percent year over year.

Total wireline data revenue, which includes strategic business services, grew slightly. Data revenue now makes up nearly 60 percent of Business Solutions wireline revenue.

The telco also reported that revenue from strategic business services, including VPNs, Ethernet, cloud, hosting, IP conferencing, voice over IP, MIS over Ethernet, U-verse and security services, grew 9.3 percent versus the year-ago quarter. These services represent an annual revenue stream of more than $11 billion.

During the quarter, AT&T also added 17,000 high-speed IP broadband business subscribers, while total business broadband had a loss of 19,000 subscribers.

The telco ended the quarter with 75.8 million business wireless subscribers. It added 133,000 postpaid subscribers and 1.6 million connected devices.

Also, AT&T had 54.7 million consumer mobility subscribers at the end of the quarter, adding 92,000 total subscribers with 500,000 prepaid subscribers, and losing 4,000 postpaid subscribers and 378,000 reseller subscribers.