Articles for AT&T

AT&T Reports Big Loss in Q4 But Record iPhone Sales Support Outlook

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Monday, January 30th, 2012 by Trefis Team

AT&T’s (NYSE:T) balance sheet took a huge hit in Q4 2011, as a one-time break-up charge of $4.2 billion paid to T-Mobile for the merger’s failure saw the company report a net loss of $6.7 billion for the quarter versus net income of $1.1 billion posted a year ago. Also contributing to the loss was a significant charge of ~$6.3 billion toward annual adjustments related to pension and post-retirement benefits accounting. Fourth quarter holiday smartphone sales, however, helped the company post 70% growth in postpaid net subscriber adds and 4% growth in revenues to $32.5 billion compared to the year ago quarter. AT&T activated a record 7.6 million Apple (NASDAQ:AAPL) iPhones during the quarter and sold more than twice as many Google’s (NASDAQ:GOOG) Android smartphones as it had during Q4 2010. Read More »

AT&T Earnings Preview: Strong Smartphone Sales Could Outshine Thinner Margins

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Monday, January 23rd, 2012 by Trefis Team

AT&T (NYSE:T) is scheduled to announce its Q4 FY2011 results Thursday. We are expecting the company to post a record quarter in terms of smartphone sales, riding on the back of iPhone 4S’ phenomenal success and the holiday demand. This should help the company add a good number of postpaid customers as well. However, a record number of smartphone sales also means that the company will have to suffer a hit on its margins as well. AT&T is the second largest wireless carrier behind Verizon(NYSE:VZ) and ahead of Sprint (NYSE:S) in the U.S. telecom industry. Read More »

AT&T Hikes Data Plan Prices as Usage Booms, $38 Fair Value

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Thursday, January 19th, 2012 by Trefis Team

As subscribers’ data usage continues to increase, wireless carriers are being forced to increase the pricing on their data plans. It started with AT&T (NYSE:T) and Verizon (NYSE:VZ) moving away from unlimited plans to tiered data plans, which charge different amounts based on the subscriber’s monthly data usage. AT&T introduced new data plans for smartphone and tablet users on Wednesday, adding additional cap space but also charging customers more, citing increasing data usage as the reason. The company mentioned that starting January 22nd, new customers on its least expensive smartphone plan will pay $20 a month for 300 MB of data, compared with the current 200 MB plan at $15.

We maintain a $38 price estimate for AT&T’s stock, which is about 25% above the market price.

See our complete analysis of AT&T here


Spectrum crunch continues

The wireless market is largely saturated now, with the number of wireless subscriber connections (327.6 million) exceeding the total population (315.5 million) in the U.S. So carriers’ focus is now on retaining customers and taking market share from rivals. This is only possible if the carrier has enough spectrum to provide competitive data speeds without congestion to the increasing number of smartphone users.

AT&T tries to counter through new data plans, slowing speeds

AT&T attempted to acquire T-Mobile in a $39 billion bid to stave off the spectrum shortage, but the withdrawal of the deal meant that AT&T had to figure out other ways to deal with its spectrum shortage until it can acquire more. One solution has been to slow down, or “throttle”, the data speeds for the highest 5% of data users on its network in order to prevent network congestion. The latest move is aimed at recouping some network costs that will be required to keep speeds competitive, and also likely to put a lid on data usage and ease the burden on its networks. With the new data plan, along with the price increase, AT&T has also raised the amount of data each plan allows, so as to help customers avoid overage fees that result when they go over their allotted data amount, which can lead to defections to other carriers. Existing customers will be able to keep their current plans.

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Weekly Telecom Notes: AT&T, Sprint and China Telecom

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Friday, January 13th, 2012 by Trefis Team

AT&T (NYSE:T) stole the limelight this week with the announcement of seven LTE-capable smartphones and one tablet at the CES 2012. Sprint (NYSE:S) announced that it is undertaking a major restructuring of its sales and marketing unit merging both its consumer and enterprise wings into a single body. Finally, the iPhone 4S could arrive on China Telecom’s (NYSE:CHA) CDMA network soon. Read More »

AT&T Makes Big LTE Push at CES 2012

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Wednesday, January 11th, 2012 by Trefis Team

Continuing on its tradition of supporting the debutantes, AT&T (NYSE:T) will be the first wireless carrier in the U.S. to offer LTE-capable Windows Phones on its network. Microsoft’s (NASDAQ:MSFT) CEO Steve Ballmer made this announcement on stage at AT&T’s CES 2012 press conference Monday. The debutantes in question here are Nokia’s (NYSE:NOK) Lumia 900 and HTC’s Titan 2, both of which are the respective companies’ first handsets that run on Windows Phone to support LTE and will be available exclusively on AT&T in the coming months. AT&T was also the first carrier to sell the immensely popular Apple (NASDAQ:AAPL) iPhone when it debuted in 2007, and remained its exclusive carrier until last year. Read More »

Weekly Telecom Notes: Verizon, AT&T & China Telecom

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Friday, January 6th, 2012 by Trefis Team

The past week saw Verizon (NYSE:VZ) reaffirm expectations by announcing a record number of iPhone sales in Q4 2011 at a Citigroup conference held Wednesday. AT&T (NYSE:T) added 11 more markets to its rapidly increasing LTE coverage and Sprint (NYSE:S) revealed the first markets where it will roll out its LTE network in coming months. Further, China Telecom (NYSE:CHA) made clear its ambitions of expanding its operations in Europe with the sale of wireless services as a MVNO in France and Germany after launching it initially in U.K.

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Weekly Telecom Notes: Verizon and AT&T

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Monday, January 2nd, 2012 by Trefis Team

The past week saw a series of outages and management missteps threaten to tarnish what was otherwise a good year for Verizon (NYSE:VZ). But the company moved quickly to rectify their mistakes before the year ended to start the new year 2012 on a fresh note. Meanwhile, with AT&T’s (NYSE:T) bid for a T-Mobile merger dead, the second largest wireless carrier in the U.S. may now look to make some low-key acquisitions to quench its spectrum thirst.

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Leap or MetroPCS Could Be Consolation Prize for AT&T

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Friday, December 30th, 2011 by Trefis Team

With T-Mobile out of the picture, AT&T (NYSE:T) may go after prepaid carriers Leap or MetroPCS to quench its thirst for wireless spectrum. This possibility was raised by a JPMorgan analyst in a note to clients on Thursday. AT&T had to drop its bid for T-Mobile after it faced months of intense opposition from both regulators and competitors alike, all of whom were concerned about the anti-competitive impacts of the merger on smaller wireless players as well as customers. AT&T was desperately pursuing the deal in order to secure the additional spectrum it says it needs to compete with Verizon (NYSE:VZ) and Sprint (NYSE:S), as well as to build out its 4G LTE network.

Our $38 price estimate for AT&T stock is about 25% above the current market price. Read More »

AT&T Dividend Capture Strategy

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Thursday, December 29th, 2011 by Trefis Team

This article was submitted by Robert Weinstein at Paid2Trade

AT&T Inc. (NYSE:T) together with its subsidiaries, provides telecommunication services to consumers, businesses, and other service providers worldwide. The company was founded in 1983 and is based in Dallas, Texas.

There are many dividend capturing strategies, and I have used more than one. Using a call option to hedge against downward price risk is my favorite strategy. I have found I must be highly selective in the companies selected. An average holding period is about three weeks, and sometimes longer. In this article we will go over an upcoming dividend with AT&T that I may capture with a minimum amount of risk. The criteria that I use is that I must be able to sell a call option in either the front, or first back month that is in the money, and with enough premium that I will not mind getting exercised early (which happens often and can be a good thing if the trades are executed correctly).

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Telecom Weekly Notes: A Big Week for AT&T and Verizon

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Friday, December 23rd, 2011 by Trefis Team

The past week saw AT&T (NYSE:T) finally pull its bid for T-Mobile Monday, ending months of intense lobbying with regulatory and government bodies opposing the deal. Meanwhile, Verizon (NYSE:VZ) continued to limit AT&T’s spectrum options outside T-Mobile by lapping up spectrum from cable operators, now adding Cox Communications to the list that previously included Comcast (NASDAQ:CMCSA), Time Warner Cable (NYSE:TWC). It was not all bad for AT&T however, as it managed to secure all the approvals necessary for Qualcomm’s (NASDAQ:QCOM) spectrum acquisition towards the end of the week.

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