AT&T income down slightly in Q1

Wireless income strong, but wireline income continues to suffer

AT&T reported net income of $3.1 billion in the first quarter of 2009, a decrease of nearly 10% from the $3.5 billion net income it reported in the first quarter of 2008.

The earnings figures were marked by a continued strong performance from the company's wireless segment and a continued deterioration of its wireline segment.

In the first quarter of 2009, AT&T's wireless segment reported before-tax income of $3.3 billion, a roughly 13% increase over the $2.9 billion net income the segment reported in the first quarter of 2008. The company also added 1.2 million wireless subscribers in the first quarter, down slightly from the 1.3 million subscribers it added in the first quarter of 2008. The company said that the iPhone 3G played a big part in adding new wireless subscribers, as the carrier activated 1.6 million of the devices in the quarter.

AT&T's wireline segment, on the other hand, saw its before-tax income drop to $2.1 billion, a 27% decrease from the $2.9 billion the company reported in the first quarter of 2008. Furthermore the wireline segment lost 196,000 subscribers in the quarter and the segment's profit margins fell to 12.8%, down from 16.7% in the first quarter of 2008. AT&T's falling wireline earnings in the first quarter of 2009 marks the continuation of a trend that started in 2008, when the company saw its wireline income drop to $11.1 billion for the year, or roughly 7% less than the $12 billion it reported in 2007.

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AT&T reported net income of $3.1 billion in the first quarter of 2009, a decrease of nearly 10% from the $3.5 billion net income it reported in the first quarter of 2008.

The earnings figures were marked by a continued strong performance from the company's wireless segment and a continued deterioration of its wireline segment.

In the first quarter of 2009, AT&T's wireless segment reported before-tax income of $3.3 billion, a roughly 13% increase over the $2.9 billion net income the segment reported in the first quarter of 2008. The company also added 1.2 million wireless subscribers in the first quarter, down slightly from the 1.3 million subscribers it added in the first quarter of 2008. The company said that the iPhone 3G played a big part in adding new wireless subscribers, as the carrier activated 1.6 million of the devices in the quarter.

AT&T's wireline segment, on the other hand, saw its before-tax income drop to $2.1 billion, a 27% decrease from the $2.9 billion the company reported in the first quarter of 2008. Furthermore the wireline segment lost 196,000 subscribers in the quarter and the segment's profit margins fell to 12.8%, down from 16.7% in the first quarter of 2008. AT&T's falling wireline earnings in the first quarter of 2009 marks the continuation of a trend that started in 2008, when the company saw its wireline income drop to $11.1 billion for the year, or roughly 7% less than the $12 billion it reported in 2007.

AT&T CEO Randall Stephenson said the company's earnings were strong considering the current economic climate and he said that the company's "cost improvement initiatives" were on track, referring in part to AT&T's commitment to lay off 12,000 employees in 2009. He also touted the company's plans to upgrade its services, such as its $1 billion investment in its global network in 2009 and its plan to double the speed of its 3G network.

"During this down cycle we continue to invest in key growth areas like mobile broadband, more bandwidth to the home through our all-IP AT&T U-verse platform, and advanced global business solutions delivered over AT&T's premier Internet backbone network," he said. "We have good momentum in all of these areas."

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