AT&T posted Q1 revenues of $40.5 billion and diluted EPS of $0.61 as reported; $0.72 diluted adjusted EPS, a 10.8% increase. The results include AT&T's acquisition of DirecTV. Compared with results for the first quarter of 2015, operating expenses were $33.4 billion versus $27.0 billion; operating income was $7.1 billion versus $5.6 billion; and operating income margin was 17.6% versus 17.1%.
“It was a good start to the year. We had solid financial results and executed well on our strategy to be the premier integrated communications provider for businesses and consumers,” said Randall Stephenson, AT&T chairman and CEO. “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." “Our consolidated revenues, adjusted earnings and free cash flow continue to grow as margins continue to expand. And we’re putting up these numbers even as we invest in building our Mexico wireless business. In addition, DIRECTV merger synergies are on track to reach $1.5 billion or better by the end of the year.”
Some highlights:
- 2.3 million North American wireless net adds driven by connected devices, Mexico and Cricket; 712,000 branded (postpaid and prepaid) phone net adds
- Total churn of 1.42% in U.S., stable year over year; postpaid churn of 1.10%
- At the end of the first quarter, AT&T had 54.7 million Consumer Mobility subscribers and added 92,000 total subscribers in the quarter with 500,000 prepaid subscribers and losses of 4,000 postpaid subscribers and 378,000 reseller subscribers.
- At the end of the first quarter, AT&T had 75.8 million business wireless subscribers. The company added 133,000 postpaid subscribers and 1.6 million connected devices in the first quarter. Postpaid business wireless subscriber churn was 1.02%, compared to 0.90% in the year-ago quarter.
- Business Solutions revenues up 0.3% year over year; wireless revenues up 2.3%
- Strategic business services revenues of $2.8 billion, up nearly $250 million
- Total business broadband had a loss of 19,000 subscribers in the quarter
- 328,000 U.S. DIRECTV net adds; total video subscribers decline slightly
- Entertainment Group broadband grew with 186,000 IP broadband net adds
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