SBC Communications added 402,000 DSL lines in Q3, giving it a total of 4.7 million subscribers. SBC also added 1.3 million long distance lines, giving it a total of 19.8 million LD accounts in service.
Some highlights for the quarter:
- Revenues -- totaled $10.3 billion, up 1.4% compared with the third quarter of 2003, driven by solid data growth and progress in consumer bundling. Third-quarter results include a net increase to revenues of approximately $60 million from regulatory and other matters, including the California Public Utilities Commission's September decision on UNE-P rates.
- Earnings -- were $2.1 billion, or $0.63 per diluted share, and earnings from continuing operations were $1.2 billion, or $0.38 per diluted share.
- Bundling -- SBC's penetration of consumer retail lines with at least one key service - long distance, DSL, Cingular Wireless or SBC / DISH Network video - increased to 58% at the end of the quarter, up from 36% a year earlier. Success in bundling drove a 9.2% increase in average monthly revenues per consumer retail line.
- Retail Access Lines -- SBC's retail consumer line base declined by 259,000 in the third quarter, a substantial improvement from declines of 624,000 in the third quarter a year ago and 558,000 in the second quarter of this year. A major driver of this quarter's improvement was a reversal in wholesale line trends. In the third quarter, SBC posted a decline in wholesale lines (UNE-P and resale) of 213,000. This compares with increases of 323,000 in the year-ago third quarter and 137,000 in the second quarter of this year. SBC's business retail access line base declined by 168,000 in the quarter. This compared with declines of 229,000 in the third quarter a year ago and 228,000 in the second quarter of this year.
- Video -- In Q3, SBC achieved a net gain of 105,000 SBC / DISH Network subscribers to reach 226,000 in service, all added since the company began offering the integrated service in March of this year. At the same time, SBC is developing plans for deployment of an advanced, IP-based network to deliver next-generation, integrated all-digital TV, super-high-speed broadband and IP voice services. The initiative will let SBC deliver high-quality, IP video with virtually unlimited content choice to millions of households. SBC has trials under way and expects to begin deployment in 2005. SBC plans to host a conference call on Nov. 11 to provide additional detail on its Project Lightspeed deployment plans.
- Data Revenues -- Wireline data revenues grew 6.1% to $2.7 billion in the third quarter, SBC's best-ever quarterly data revenue total. These results reflect continued growth in DSL services and progress in the large-business market.
- Large-Business Market -- SBC continues to expand into the large-business market. Year to date, SBC signed more than 450 contracts with a value of $1 million or more - including in the third quarter agreements with Ford Motor Co., Unocal Corp. and Provena Health. More than 80% of SBC's third-quarter contracts included data services.
- Cingular Wireless -- Cingular Wireless accelerated subscriber growth in the third quarter, with record gross customer additions of 2.8 million and net subscriber additions of 657,000. Cingular's third-quarter net-add total was up 54% from its gain in the second quarter of this year, and it ended the quarter with 25.7 million total subscribers. Cingular revenues totaled $4.3 billion in the quarter, up 4.9% from the year-earlier third quarter.
