AT&T Earnings Give Hope to Telcos

AT&T said second-quarter net income jumped 30%, to $3.7 billion, as operating revenue rose 4.7%, to $30.86 billion. It also reported adjusted operating margins of 37.3%, beating the expectation of some analysts. The largest US phone company's profit jump suggests that the economic slump may not be as harsh as expected for some telecom service providers. Some of the strength came from cost cuts, and the economic slowdown is crimping demand for some services, including high-speed Internet access. AT&T continues to bleed access lines and could not cover that lost revenue with improved broadband sales. But AT&T was able to offset weaknesses through ongoing demand in such areas as wireless calling.
AT&T Net Rises 30% Despite Weaknesses