AT&T, the second largest mobile carrier in the United States, has released their first quarter financials. The company reported revenues of $39.4 billion for the quarter, a drop from the $40.5 billion the carrier reported in the same quarter last year. $17.2 billion of the revenue is contributed to the wireless division, down 4.4% over the previous year. The company reported that the reduction in revenue was attributed to the low number of equipment upgrades made by subscribers as well as the the lower ARPU (average revenue per user) thanks to recently adopted unlimited plans.
All of this contributed to a drop in net profit for the company. For the quarter, the company made $3.5 billion, down from the $3.8 billion in the first quarter of 2016. The carrier has $3.2 billion in free flow cash available.
Perhaps more interestingly to readers is drop in postpaid subscribers. As I reported yesterday, T-Mobile saw a significant increase in their number of subscribers last quarter and that came at the expense of other carriers like AT&T. The company reported that they had a decrease of 191,000 postpaid subscribers for the quarter. However, the good news for the company comes in prepaid. Take those into consideration, along with postpaid, and the carrier gained some 738,000 subscribers in the quarter. Even with the drop in postpaid subscribers, the company reported a record low of .9% churn rate.
Like T-Mobile, Verizon and Sprint, the financials for the current quarter (which will be made public sometime in July) will be interesting to watch. All of the carriers have a plethora of new devices hitting their networks this quarter such as the LG G6 and the Samsung Galaxy S8 lineup. That will likely drive up the number of equipment upgrades which, in turn will help revenues.
AT&T also reported their purchase of 20MHz of low spectrum 600MHz band which they will use to expand their network.