AT&T Q3 Net Income, Revenue Up

AT&T reported net income of $2.2 billion for the third quarter of 2006, up significantly from $1.2 billion before SBC Communications and AT&T merged last November.

Before the merger, the old AT&T posted net income of $520 million for the third quarter of 2005. The new AT&T’s net income, released Monday, still outpaced the combined net incomes of the two companies by nearly 23 percent.

Growth in nearly all areas, including large-business services and consumer and business wireline service, fueled the quarterly report. AT&T’s directory services posted a 5.3 percent drop from SBC’s third quarter of 2005, but that was the only business segment with a decline.

The new company had a “great” third quarter, Edward Whitacre, AT&T’s chairman and chief executive officer, said in a written statement. AT&T is meeting its goals of integrating the operations of the old AT&T and ramping up the financial performance of Cingular Wireless, and the company has “excellent momentum,” he said.

AT&T posted revenue of $15.6 billion, or 56 cents per share, for the third quarter, which ended Sept. 30. That’s up nearly 52 percent from SBC’s third-quarter revenue of $10.3 billion in the third quarter of 2005. The old AT&T posted revenue of $6.6 billion in the third quarter of 2005, meaning that, compared to the combined revenue of the two old companies, the new AT&T’s revenue dropped slightly.

Cingular Wireless, which AT&T co-owns with BellSouth, had revenue of $9.6 billion for the third quarter, up more than 9 percent from the $8.7 billion revenue from a year earlier. Income at Cingular was $1.1 billion, up from $326 million in the same period last year.

AT&T is in the midst of seeking regulatory approval for a merger with BellSouth.

-Grant Gross, IDG News Service (Washington Bureau)

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