AT&T Mobility posts U.S. industry record 2.7 million net adds in Q4: Acquisition of Dobson contributed 1.7 million during quarter

New wireless subscribers came to AT&T Mobility in record droves during the fourth quarter; the carrier added 2.7 million net new customers to the rolls — an all-time record high among U.S. wireless carriers. The growth was well ahead of even the most optimistic forecasts.
Profits soared to $3.14 billion, a 62% increase from $1.94 billion a year ago, yet after a slight jump in the morning, Wall Street’s glaring eye sent the carrier’s stock down a little more than a percent to $36.32 per share on continued concerns over the economy.
The nation’s largest carrier ended the year with 70.1 million customers. Retail postpaid net additions reached 1.2 million during the quarter and accounted for just over 55 million of the total customers on the carrier’s network at the end of the year. More than half of the remaining new wireless customers during the quarter were from prepaid channels and resellers. AT&T Mobility’s acquisition of Dobson Communications, which closed in mid November, also brought 1.7 million customers into the company fold. Overall, the carrier grossed an additional 6 million new customers in the quarter, which also set the industry’s best-ever quarterly gross in new wireless subscribers, the company said.
iPhone additions
Wireless analysts continue to be upbeat about continuing Apple Inc. iPhone sales, and anticipate more growth throughout this year. AT&T Mobility reported that just under 2 million iPhones are now on its network, with about 40% of those users having switched from other carriers, the company said in a conference call. Despite CEO Randall Stephenson’s comments about non-paying land-line customers earlier this month, which prompted shares to steadily fall, AT&T is still looking through 2008 with optimism, forecasting revenues to grow in the 5% range or better.
However, the carrier again highlighted weaknesses in its broadband Internet and wireline businesses, mostly due to disconnecting customers who didn’t pay their bills. On the conference call, AT&T’s CFO Rick Linder said both businesses are seeing an impact from the economic downturn.
Customer metrics
AT&T Mobility’s average monthly subscriber churn was down from 1.8% to 1.7% overall from the year-ago quarter, and postpaid churn averaged out at 1.2%, down from 1.5% from a year prior, the company reported. Wireless revenues increased 16.3% to $11.4 billion in the quarter, with $10.2 billion of that coming directly from services, which excludes handset and accessory sales. The wireless division’s profit increased 45% to $1.9 billion.
Average monthly revenues per user hit $50.28, up 1.9% from the year-earlier quarter, marking the sixth consecutive quarter of year-over-year ARPU growth for the operator. Meanwhile, data revenues increased 57.5% from a year ago, driven largely by further adoption of smartphones and 3G services.