iPhone gold rush still flowing for AT&T

Android phones may be all the rage right now, but for AT&T the Apple iPhone remains its more alluring gold mine.

Android phones may be all the rage right now, but for AT&T the Apple iPhone remains its more alluring gold mine.

In its third-quarter earnings released Thursday, AT&T reported that it activated a record 5.2 million iPhones, a 62 per cent increase from the company’s previous record of 3.2 million iPhones activated in the second quarter. AT&T says that nearly a quarter of those activations were for new customers.

White iPhone seen in the wild, but you can't have one

Those 1.25 million new iPhone users represented just under half of the 2.6 million wireless subscribers that AT&T added in the third quarter. AT&T reported healthy gains in wireless revenues over the past quarter, as its $13.7 in revenues represented a 10.5 per cent increase over the $12.4 billion in wireless revenues the company posted in the third quarter of 2009. AT&T’s wireless churn rate dropped to 1.32 per cent in the third quarter, down from 1.42 per cent in Q3 2009, meaning that AT&T is turning over fewer customers this year than it was a year ago.

Overall, AT&T this past quarter posted net income of $12.3 billion, nearly four times the $3.2 billion in earnings it posted in the third quarter of 2009. However, a good chunk of the earnings were a result of a one-time tax settlement and from a gain in selling its Sterling Commerce unit. On the year, AT&T has so far posted earnings of $18.8 billion, nearly double the $9.5 billion net income the company had posted through three quarters last year. Revenue crept up to $31.5 billion from $30.7 billion in Q3 2009.

AT&T’s strong earnings report comes during a time when rumors have been flaring up that Verizon and Apple might be close to finishing a deal to bring a CDMA-based iPhone to Verizon. AT&T has had exclusive rights to sell the iPhone to customers in the United States since its debut in 2007. The iPhone’s popularity has been a major factor in helping AT&T keep pace with Verizon’s total number of subscribers, as AT&T now has a total of 92.8 million wireless users nationwide.

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