AT&T activates 2.4m iPhones in Q2

The new iPhone 3GS is already setting records for AT&T Mobility.

The company, which reported its second-quarter earnings yesterday, said it activated 2.4 million iPhones and added 3.5 million integrated 3G devices (or handsets with Qwerty or virtual keyboards) on its network during the quarter.  It added 1.2 million net postpaid subs, its best-ever second quarter performance.

AT&T's Mobility division recorded operating income of $3.2 billion, up 2.8% over the same quarter a year ago, and operating expenses of $10.1 billion, up 12.5%. However, the wireless operating margin was slightly lower for the quarter at 23.8% vs. 25.5% in the year-earlier quarter, most likely due to iPhone 3GS acquisition costs. Without those costs, AT&T said its second-quarter OIBDA (operating income before depreciation and amortization) margin would have been 40%, two points higher.

Here's a breakdown of other key metrics:

Net adds: AT&T added 1.4 million net subscribers during the quarter, for a total of 79.2 million subscribers. Of the quarter's net adds, 1.2 million were postpaid, which is an increase of 29% compared with the second quarter of last year.

ARPU:  Average revenue per user increased 2.3% to $60.21 compared with the year-earlier quarter. Postpaid data ARPU was $17.72, up $3.66 over the previous year's quarter and up $1.24 from the first quarter of 2009.

Churn: Postpaid churn was just 1.09%, the lowest level in the company's history, and down from 1.10% in the previous year's quarter. Total churn was 1.49%, down from 1.64% in the year-earlier quarter.

Data growth: AT&T's data revenues increased 37.2% over second quarter of 2008 to $3.4 billion. Data now accounts for 28.7% of AT&T's second quarter wireless revenue.

There were no major surprises in AT&T's Q2 09 earnings as the telco reported that consolidated second quarter revenues of $30.7 billion were down by 0.4% year-over-year, but up sequentially.

Another growth spot was consumer and business IP-based data services. The telco reported that total wireline IP data revenues, which were driven by U-Verse service expansion and business VPNS and VoIP, grew 5.2% to $6.6 billion. This growth was led by a 17% increase in IP-based service revenues.  

However, the telco continues to see negative trends in total landline connections, which were down 13.4% during the quarter.

 

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